This is the first time HSBC has offered Premier customers an exclusive two-year fixed rate since 2019. 

The rate cuts impact both new purchase and remortgage three-year fixed rates.

Rates have reduced across residential, Right to Buy, and Deposit Unlock products.

The lender has also made changes to its Energy Efficient Homes Cashback mortgage.

The lenders have joined Leeds Building Society in reducing rates during the first week of January.

Despite the monthly fall, mortgage approvals remain above their 12-month averages.

The Society has reduced rates across its purchase and remortgage ranges.

Average mortgage rates are predicted to fall to around 4% by the end of next year, driven by four Base Rate cuts in 2025.

The Bank has also reintroduced 60% LTV green remortgage rates and new 60% and 75% LTV two-year fixes.

Since the start of 2024, the average five-year fix has not dropped as much as its two-year counterpart.