Two, three and five-year fixed rate mortgages have all dropped in cost over the past 12 months and witnessed some big reductions compared to five years ago, according to Mortgage Brain’s latest analysis.

The firm says that the cost of a 60% loan-to-value (LTV) five-year fixed, for example, is now 5.7% lower than it was this time last year, while a 60% LTV two-year fixed is now 4.1% lower. Meanwhile, 80% LTV five and two-year fixed rate products now cost 3.2% less than they did at the beginning of January 2019.

Mortgage Brain also saw a big improvement in terms of cost compared to five years ago, with data showing a reduction in cost for the two-year fixed 60, 70, 80 and 90% LTV products of between 9.8% and 17.8%.

In monetary terms, the 5.7% reduction in cost over the past 12 months equates to an annual saving of £432 on a £150,000 mortgage.

However, compared to five years ago, borrowers can secure a potential annual saving of £1,584 for the 90% two-year fixed, and £1,206 and £882 for the five and two-year 60% LTV products respectively.

Mark Lofthouse, chief executive officer at Mortgage Brain, commented: “Our latest product data analysis shows that while there is little to get excited about in terms of rate and cost movement over the past three months, the UK mortgage market has seen some big cost reductions over the year and particularly over the last five years.”