You are here: Home - Mortgages - First Time Buyer - News -

Slump in tracker take-up as borrowers flock to fix mortgage rate

Written by: Christina Hoghton
The number of tracker rate mortgages has fallen to its lowest level in nine years.

Following the Bank of England’s Base Rate rise in November, the number of tracker rate products available dropped to the lowest number since September 2009, when there were 255 on offer.

According to financial information provider Moneyfacts, there are now just 268 tracker deals on the market, down from 294 a year ago.

Average tracker mortgage rates have inevitably risen since the Bank of England hiked its Base Rate to 0.5% in November. After all, they are pegged to the Base Rate and usually mirror its movements.

The average tracker rate rose from 1.93% in November 2017 to 2.15% today. It is still much lower than the 3.76% recorded in September 2009, but borrowers are drawn to the safety of the current low fixed rate mortgages available.

Charlotte Nelson, finance expert at Moneyfacts, said: “The number of tracker rate mortgages on the market has been in steady decline for some time.

“The fact that the markets are already starting to factor in multiple Base Rate rises makes the tracker rate market particularly unstable. In uncertain times providers are more likely to concentrate their efforts on fixed rates rate rather than trackers, and this is one of the main reasons for the steady decline in tracker deals.

“During uncertain times, borrowers tend to err on the side of caution; opting for a fixed rate instead of leaving themselves exposed to a potential rate rise. This lack of demand is also depleting variable products, with providers choosing to focus on fixed deals instead.”

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Everything you wanted to know about ISAs…but were afraid to ask

The new tax year is less than a fortnight away and for ISA savers or investors, it’s hugely important. If yo...

Your right to a refund if travel is affected by train strikes

There have been a wave of train strikes in the past six months, and for anyone travelling today Friday 3 Febru...

Could you save money with a social broadband tariff?

Two-thirds of low-income households are unaware they could be saving on broadband, according to Uswitch.

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

DIY investors: 10 common mistakes to avoid

For those without the help and experience of an adviser, here are 10 common DIY investor mistakes to avoid.

Mortgage down-valuations: Tips to avoid pulling out of a house sale

Down-valuations are on the rise. So, what does it mean for home buyers, and what can you do?

Five tips for surviving a bear market mauling

The S&P 500 has slipped into bear market territory and for UK investors, the FTSE 250 is also on the edge. Her...

Money Tips of the Week