Fixed-rate loans hit record levels
The number of buyers choosing fixed-rate mortgages is at its highest level since records began, according to research from Mortgage Trust. Although the number of borrowers selecting fixed-rate loans has seen a steady increase over the past two years, the last six months have seen a dramatic rise in this type of mortgage. Fixed rate mortgage deals now constitute over 60 per cent of the market, up from 48 per cent in September 2006.Short-term fixed-rate deals are the most popular with a surge in two- and three-year mortgages. Only one financial adviser said that full term fixed-rate loans were popular. Economist John Heron commented: "Our research also shows that an even higher proportion of landlords have been taking out fixed-rate loans. 78 per cent of landlords have been opting for fixed-rate mortgages in recent months. Landlords are, in the main, shrewd investors, aware of the financial environment in which they are operating. As rates have started to rise, they have sought to ensure that they remain in a financially stable position."Landlords clearly have their doubts about short term interest rates, with most expecting a further increase. However, their long-term expectations are more optimistic, with the majority of landlords looking to benefit from improved variable rates in two years' time."
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