Nationwide is set to launch new competitive mortgage products, including a five-year fixed-rate mortgage at 3.74% and two-year fixes starting from 3.89%, undercutting Santander’s current market-leading offerings. These rates are a significant move as lenders compete to attract borrowers, particularly with interest rates falling after a period of high increases.

In addition, Nationwide has expanded its Helping Hand initiative for first-time buyers, now offering lending up to six times a borrower’s income with a 95% loan-to-value (LTV) ratio. This is likely in response to competitors providing mortgages at 5.5 times income, as lenders push to support first-time buyers in an increasingly challenging housing market.

Other major lenders are also cutting rates: NatWest has lowered its two-year fixes to just above 4%, Accord has reduced its fixed rates, and MPowered has made further rate cuts. These reductions come at a time when the market is adjusting to the end of the Bank of England’s aggressive rate hikes, providing some relief to prospective buyers and those looking to remortgage.