Fixed rate mortgages 'less popular than ever'

Date:Thursday 17th December 2009
Author: Susanna Kavka

Fixed-rate mortgages have become less popular with property buyers, according to John Charcol.

The independent mortgage adviser reported that just over 21 per cent of their clients opted for a fixed-rate mortgage in November, a decline of five percentage points on the previous month.

This is the smallest market share for fixed-rates since October 2008 and a large decline from the peak in popularity experienced by fixed-rates in June of this year, when 83.1 per cent of products taken out with John Charcol were fixed-rates.

Clients who did choose to take out a fixed-rate product mainly went of two-year fixes, with five year fixed-rate products being the second most popular.

Ray Boulger of John Charcol said: "Although fixed rates fell a little further than trackers the difference in the initial pay rates still assumes Bank rate will increase more quickly than many economists predict."

Earlier this month, John Charcol stated that the reductions currently being made to fixed-rate products were a good sign for anyone who had been waiting for a cheaper fixed-rate product.