Cheaper mortgages won't save Britain from recession

Electricity bills are going up. Netflix is adding a couple of pounds a month to the price of a standard subscription, and council tax is going through the roof. Most of us are probably struggling with the cost of living. There is, however, one piece of good news: the sub four per cent mortgage is back. The only catch is that it won’t be around for long.

Santander will this week start offering two- and five-year fixed rate mortgages at just 3.99 per cent, the first time any of the major lenders have been willing to lend money to homeowners for less than four per cent for several months. A price war may be about to break out, with the big lenders competing to offer better and better deals. Chancellor Rachel Reeves will no doubt be hoping that lasts. As the economy slides into recession she needs some help from somewhere, and cheaper mortgages plus a surge in house prices might just stop GDP from shrinking.