A fixed-rate mortgage priced at below 5% has gone on sale for the first time since June as leading lenders announced a fresh wave of home loan reductions. Brokers said a mortgage rate war was “well and truly under way” and that the lower pricing should provide a boost to borrowers worried about the imminent end of their current deal, as well as would-be homebuyers who have been sitting on the sidelines. UK lenders have been reducing their rates for several weeks, and the last few days have seen a flurry of reductions, with further cuts due to take effect on Friday courtesy of banks including the Halifax. On Thursday, a five-year fixed-rate deal priced at 4.99% was launched by The Mortgage Works, a division of Nationwide building society, which brokers said was the first sub-5% fixed deal they had seen for several months. It is thought it is the first fixed-rate product priced at below that level since late June. The 4.99% product is a buy-to-let deal rather than a standard residential mortgage and is available to people borrowing up to 55% of the property’s value. Ranald Mitchell, a director at the broker firm Charwin Private Clients, said: “Seeing rates starting with a 4 is a sight for sore eyes and could provide a stimulus to the market and borrower confidence.” Moneyfacts, the financial data provider, said the average rate on a new fixed-rate deal lasting for five years was now 6.14%, though there are best-buy deals available that are considerably cheaper than that: for residential mortgages, the cheapest five-year fix on Thursday was priced at 5.12%. Halifax has announced reductions of up to 0.5 percentage points on selected fixed deals, taking effect from Friday. It means it will have five-year fixed deals priced at 5.15%. The Mortgage Works has also cut rates by up to 0.5 percentage points, with effect from Thursday, while brokers say Coventry building society is also reducing some rates on Friday. These moves come hard on the heels of cuts by other high street players. On Wednesday, Nationwide reduced some of its fixed rates by up to 0.29 percentage points, while on the same day Santander trimmed selected new fixes by up to 0.14 percentage points. Mortgage costs had been rising for months, but UK lenders have been reducing their rates since the second half of July after it emerged that UK inflation fell further than expected in June. However, another Bank of England rate rise next week – a decision will be announced on 21 September – could put the brakes on further reductions. The Bank’s base rate is now at 5.25%, and many commentators anticipate a rise to 5.5%. Amit Patel, an adviser at the broker Trinity Finance, said: “After a summer of doom and gloom, it feels that as we head into the autumn months, we may have turned the corner.” Diarmuid Phoenix, an adviser at Mint Mortgages & Protection, said: “Seeing the return of rates under the 5% bracket in line with falling swap rates should hopefully give a boost of confidence to borrowers who have been living in fear of the end of their current fixed-rate deals, as well as those who have been sitting on the fence waiting for rates to come down before purchasing.”