Variable-rate deals gaining in popularity

Borrowers are showing an increased interest in variable-rate deals, new research from Spicerhaart Financial Services has shown, though fixed-rate products are nonetheless still the overwhelming market leaders.

The study of figures from last month revealed that variable-rate mortgages now account for 14 per cent of the total borrowing market, up from nine per cent in June.

While first-time buyers saw their share of the market increase fractionally to 37 per cent, their increasingly strained efforts have meant that high loan-to-value (LTV) mortgages increased their share of the market for the sixth month in a row.

"With interest rates still historically low, homeowners and first-time buyers, still confident in their financial security, are as keen as ever to move up the property ladder, even if this means borrowing slightly more," commented Spicerhaart Financial Services operations director Steve Cox.

Abbey revealed earlier this month that 80 per cent of first-time buyers are now taking out LTV mortgages worth 75 per cent or higher.


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