The Spicerhaart Financial Services monthly mortgage survey shows that a higher percentage of borrowers believe interest rates have peaked and house price growth will level off in the second half of the year.

According to the survey, 86% of its customers are taking out fixed rate mortgages in July, but the amount of borrowers opting for variable mortgages has increased from 9% to 14%. This is the highest proportion since October 2006, and 11% of borrowers chose mortgages that tracked the base rate, 1.7% choosing a discount deal and 1.3% opting for other variable rates.
Steve Cox, operations director of Spicerhaart Financial Services, said: “The increasing proportion of variable mortgages indicates that borrowers are starting to believe that interest rates have peaked, as inflation stabilises, and are likely to come back down again before the end of the year. With interest rates still historically low, homeowners and first-time buyers are still confident in their financial security and are as keen as ever to move up the property ladder, even if this means borrowing slightly more.”