Growing speculation over interest rates prompted a jump in remortgage borrowers locking into fixed rate deals last month.
June saw 93 per cent of remortgage borrowers opting to fix their rates, up from 88 per cent during May, according to the National Mortgage Index from Mortgage Advice Bureau (MAB).
This matches the record set in November 2013 when 93 per cent of borrowers remortgaging chose fixed over variable deals: the highest percentage seen since the Bank of England lowered its base rate to 0.5 per cent in 2009.
The change is likely due to speculation about looming interest rate rises from the Bank of England.
Good fixed rates available
The average two-year fixed rate fell to 3.61 per cent in June, while the three-year fixed rate fell to a seven-year low of 3.75 per cent.
MAB head of lending Brian Murphy commented: “We have seen gradual rises since the start of the year, but [this] proves that exceptionally good rates are still available and lenders are keen to lend.”
However the average five-year fixed rate climbed to 4.14 per cent in June, up for the fifth month in a row.
Murphy added: “More people are keen to lock down their rates for longer before the Bank of England makes a change. Borrowers need to be prepared to pay a slightly higher price for the confidence and certainty that long-term fixed rates can bring.”
