The number of people choosing tracker rate mortgages have more than doubled in the past 12 months from February’s 2007 figure of 14% of the mortgage market to February 2008’s figure of 35%, according to the Council of Mortgage Lenders (CML).

The number of people opting for fixed-rate loans has fallen to 52%, which is its lowest level since March 2005. Floating rate products have also become increasingly attractive when compared with fixed-rate products, as consumers expect further base rate reductions in the coming months. These mortgage figures typically relate to applications taken out several months ago, and do not reflect the shrinking availability of mortgage products and re-pricing which has been a feature of the market in recent weeks.

First-time buyers in February typically borrowed 88% of the property’s value, unchanged from January and 3.33 times their income (also unchanged from January). Home movers typically borrowed 71% of the property’s value, and 2.97 times their income, unchanged from January.

Mortgage lending activity in February remained subdued. February’s gross lending totalled £25bn, down 3.5% from £25.9bn in January and 2.3% from £26.6bn in February 2007. Loans for house purchases declined in volume to 49,000, down 3.5% from 50,900 in January, and by 5.1% in value to £7.5bn. The number of loans for house purchases has been more than 30% lower than a year ago for the last three months, and this picture of year on year declines will likely continue throughout 2008.

Remortgaging made up 45% of all lending in February, this is unchanged from January and the highest share since March 2005. Remortgaging activity is likely to remain relatively strong, and will likely represent a higher percentage of all lending for the rest of the year, given the wave of borrowers due to come off fixed and discounted rates in 2008.