The latest UK housing market research to surface is leading many experts to see only one short term future. The amount of activity is shrinking and some fear transactions are on a track to continue to slow down. This may be the cause of lenders currently cutting mortgage rates and why remortgage activity is beginning to dry up.

Analysts are seeing the latest data as a reason for concern and many lenders are responding with mortgage lending deals which offer interest rates which reach new lows. The Bank of England is taking notice and reporting borrowing costs for the month of March which sank to record lows.

Low interest rates have the ability to assist those in search of housing who are able to put together enough for a down payment. However, house prices have been climbing so fast for so long first time buyers are still being kept at bay. The group is often resorting to the rental market or borrowing from the bank of Mum and Dad.

There are low interest rates, and then there are even lower rates. The timeline for the drop in rates is quite surprising to even the most seasoned experts. Compared with the year 2014, the average two-year fixed mortgage deal will now cost more than 40% less. Five year rate deals have fallen almost 40%.

There is even a smartphone-only provider offering a five year deal with a rate below 1.3%.

Remortgage deals are beginning to show signs of slowing in number. Many house owners are deciding on longer-term fixed rate deals and opting out of the idea of revisiting their mortgage plan.

David Hollingworth with London & Country commented on the latest housing data, saying: “Where you have total lending showing no growth and new competition entering the market, lenders don’t want to relax their criteria so that leaves only one option: cutting the price.”