Inflation has slowed for 3 months in a row. August’s figures were expected to show a slight uptick as a result of rising fuel prices but, instead, there was a fall of 0.1% to 6.7% and many experts believe we are over the worst. And, it seems, that now includes the Bank of England, who have announced the base rate is to remain at 5.25%, ending a run of 14 consecutive rises.

Mortgage rates were already coming down and it remains to be seen whether the news will bring further reductions. It’s the cost of the longer-term 5-year fixed-rate mortgages that have seen the biggest falls. Some of the best deals are down by as much as 0.4% and one or two have dropped below 5%. The base rate, on the other hand, is expected to remain at 5.25% for some time before it starts coming down.

Falling finance costs should help shore up the housing market. However, as there are still large numbers of borrowers on fixed-rate deals who have yet to feel the full impact of the rising base rate, sales are unlikely to take off again in the near term. Next year, 1.6 million people will be coming to the end of their deals.

Those with five-year fixes will have been used to rates of between 1.5% and 2%. At current levels, they will see their mortgage payments shoot up by between 250% to 350%. And, as late as spring last year, the best deals were still around 2%, so it will be a shock for those on two and three-year fixes, too.

Below is a selection of this month’s best buys from Moneyfacts.co.uk:

Two-year fixed rates: 5.70% from first direct. Product fee £490. 75% LTV.
5.70% from Nationwide. Product fee £0. 60% LTV.

Three-year fixed rates: 5.62% from first direct. Product fee £490. 75% LTV.
5.74% from Nationwide BS. Product fee £999. 60% LTV.

Five-year fixed rates: 5.08% from first direct. Product fee £490. 75% LTV.
5.14% from first direct. Product fee £0. 75% LTV.

Discounted variable: 5.24% For 2 years. From Harpenden BS. Product fee £800. 65% LTV.
5.29% For 2 years. From Beverley BS. Product fee £1,495. 65% LTV.

BUY-TO-LET (BTL)

Best two-year fixed rate: 4.89% from The Mortgage Works. Arrangement 3.00% Advance. 65% LTV.

Five-year fixed rate: 5.04% from The Mortgage Works. Arrangement 3.00% Advance. 65% LTV

Best Discounted variable: 5.20% For 2 years. From Monmouthshire BS. Arrangement 2.00% Advance. 75% LTV.