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Ninety per cent of first-time buyers opt for fixed rates

26 March 2007
Nine out of ten first-time homebuyers are choosing the relative security of a fixed-rate mortgage to keep their repayments constant in a context of ever-rising house prices, has found.

Tracker mortgages have declined in popularity under pressure from three successive interest rate rises, the financial advice site claims, while the affiliation to fixed-rates has grown with every rate rise.

The August hike saw four out of ten homebuyers opt for fixed-rate mortgages while the November rate rise pushed that proportion up to seven out of ten.

And first-time buyers have been overrepresented among the fans of fixed-rate throughout – eight in ten opted for fixed repayments after the August rate hike, rising to nine in ten after the surprise January rise.

According to Spicerhaart Financial Services, the number of homebuyers opting for longer-term five-year plus fixed-rate mortgage deals rose by 11 per cent in February to hit an all-time high of 32 per cent of homebuyers.

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