Fixed rate popularity hits record high
In the first quarter of the year, 89% of mortgages arranged by advisers were on a fixed rate, according to Paragon Mortgages’ Financial Advisers Confidence Tracking (FACT) Index report, based on interviews with 200 mortgage intermediaries. That is 6% higher than the previous three months, and continues a long-term, upward trend starting in 2010, when 46% of borrowers opted for fixed rates.
Two-year fixed rates are still the most popular, accounting for 48% of mortgages arranged, but there was a significant jump in the popularity of five-year fixed rates, up 3% to account for 34% of mortgages arranged.
John Heron, managing director, Paragon Mortgages, said: “It’s clear to see that the benefit of certainty at such low rates is continuing to drive up the popularity of fixed rate mortgages – particularly five year fixed terms, which gained further ground in Q1 2017.”