However, there have been concerns that banks will not pass on the lower rate to new customers or existing customers needing a new contract.
Banks are required to pass on cuts to existing customers on tracker rate mortgages.
Robert Sinclair, director of the Association of Mortgage Intermediaries (AMI), said: "It will be interesting to see whether institutions immediately pass this benefit on to consumers who have been struggling under rising mortgage costs during the year.
"We want to see real benefits for consumers, particularly in light of the turbulence in the sector."
Meanwhile, research has suggested that more people on modest incomes are now buying homes.
Spicerhaart Financial Services said its survey showed that the number of people earning less than £40,000 a year buying their first homes had jumped by 16 per cent in the last four months.
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