Consumers ‘taking less fixed-rate mortgages’

Consumers are seeking fewer fixed-rate mortgages amid expectations that the base rate will stay low, it has been stated.

Figures from mortgage broker John Charcol have revealed that over the summer months, the number of people taking out discount or tracker mortgages has risen threefold while fixed-rate deal take-up has fallen.

In August, 41.9 per cent of the company’s customers agreed to a fixed deal, the lowest share of the total since December 2008.

Spokesman Ray Boulger said a reason for people choosing not to take fixed deals is that these have become more expensive in anticipation of rate rises.

Yet at the same time the Bank of England has hinted that “it increasingly looks as if interest rates will remain low for at least two to three years on the back of a very slow economic recovery”, he noted.

The “fundamentals” are in place for the overall number of mortgages to rise in the months ahead, director of estate agency portal propertyfinder.com Nicholas Leeming suggested recently.

However, the extent of this rise could be limited by an ongoing shortage of mortgage finance, he said.

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