"It’s easy to understand the ongoing demand for fixed rate products; firstly, this points to increasing consumer awareness in terms of searching out the best deal available"
94% of all new purchase borrowers and 89.6% of remortgagors chose a fixed rate mortgage in November.
MAB cited increasing average loan sizes, which means borrowers want greater peace of mind, and a "raft of competitively priced deals" as reasons for the growing popularity of fixed rates.
MAB's Index also shows that the overall mortgage market was steady in November, with this being the first month where completed transactions were most probably instigated post-Referendum.
Its data shows that average purchase prices have increased marginally month-on-month by 1.1.% and have risen year-on-year by 0.5%, corroborated by the average size of purchase loan which is up 0.8% in November on October and 1.2% annually.
Brian Murphy, Head of Lending for Mortgage Advice Bureau, commented: “The fact that over the last few years we’ve seen the number of borrowers opting for a fixed rate mortgage increasing to an average of nine out of ten shows that consumers are continuing to take advantage of the raft of competitively priced deals that are available. Interestingly though, this trend started well before this year so rather than seeing a steep curve which, given the events of 2016 both politically and economically might be expected, it’s been a gradual change over the last two or three years.
"It’s easy to understand the ongoing demand for fixed rate products; firstly, this points to increasing consumer awareness in terms of searching out the best deal available. But it also reflects more and more households choosing to control or cap potentially their biggest point of monthly expenditure and taking the considered step of borrowing on a fixed rate in order to reduce their outgoings and make a significant saving.
"Seeing the increase in uptake of fixed rate products over the last five years, it’s clear the message that savings can be made is hitting home with consumers, and this is a trend which we expect to continue over the coming months."
