Variable-rate mortgages 'the preferred option'
Wednesday, 13 April 2011 2:43 PM
Newly published statistics have shown variable rate mortgages to remain the best option for many homeowners, according to independent mortgage expert John Charcol.
The organisation's senior technical manager Ray Boulger said figures relating to retail sales and inflation made it seem possible that the historically low Bank of England base rate of 0.5 per cent could continue into 2012.
Economists had previously anticipated a rise early in the year – potentially in May to coincide with the publication of the quarterly Inflation report.
But Boulger said this was less likely in light of the "even worse than expected" retail sales data and "much better than expected" performance on inflation measures.
All of this added up to make variable rate mortgages a better option for many people than fixed-rate alternatives.
In February, 56 per cent of John Charcol customers opted for a fixed rate; however, in March this fell back to 50 per cent.
The turnaround came as fixed rates rose on many products, whereas tracker mortgages linked directly to the base rate continued at their existing levels when the Monetary Policy Committee again announced no change to the reference rate of interest.
Boulger added: "The advice for anyone wanting a fixed rate is to wait for rates to fall. In our opinion, for borrowers not needing the security of a fixed rate, tracker and discount rate mortgages continue to offer better value."
Newly published statistics have shown variable rate mortgages to remain the best option for many homeowners, according to independent mortgage expert John Charcol.
The organisation's senior technical manager Ray Boulger said figures relating to retail sales and inflation made it seem possible that the historically low Bank of England base rate of 0.5 per cent could continue into 2012.
Economists had previously anticipated a rise early in the year – potentially in May to coincide with the publication of the quarterly Inflation report.
But Boulger said this was less likely in light of the "even worse than expected" retail sales data and "much better than expected" performance on inflation measures.
All of this added up to make variable rate mortgages a better option for many people than fixed-rate alternatives.
In February, 56 per cent of John Charcol customers opted for a fixed rate; however, in March this fell back to 50 per cent.
The turnaround came as fixed rates rose on many products, whereas tracker mortgages linked directly to the base rate continued at their existing levels when the Monetary Policy Committee again announced no change to the reference rate of interest.
Boulger added: "The advice for anyone wanting a fixed rate is to wait for rates to fall. In our opinion, for borrowers not needing the security of a fixed rate, tracker and discount rate mortgages continue to offer better value."
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- interest rates ,
- mortgages ,
- uk property news
