Demand for tracker deals plummets
This equates to some 4,848 potential remortgages each day over the next six months, according to the Index, which monitors remortgaging trends on a monthly basis..
The research reveals that those who are coming to the end of their mortgage deals in the next six months are increasingly disinclined to choose a tracker deal, with expectations of Bank of England base rate rises at some point this year. Of those homeowners due to remortgage in the next six months, only 13% say they will opt for a tracker deal, compared to 33% just two months ago.
According to Santander Mortgages the number of those likely to opt for a fixed rate deal has increased from 20% to 23% over the last month. Half of these people (50%) favour a two year fix rather than a three or a five year deal.
Phil Cliff, director of mortgage marketing at Santander UK commented: “A significant number of people could remortgage in the next six months and among those considering their next deal there is a potential for a fall in demand for tracker deals. Borrowers have seen a large number of highly competitive fixed deals come on to the market recently and with many commentators predicting a base rate rise this year, homeowners now seem more inclined to play it safe with a fixed rate deal.”
According to Santander Mortgages Remo Index, over half (51%) of homeowners who will be remortgaging in the next six months say the factor that will most influence their decision on which deal to take is the opportunity to take advantage of a good rate. This is followed by the opportunity to make under or overpayments (9%) and speculation that the Bank of England’s base rate will go up (6%).