The latest monthly index from John Charcol revealed that the proportion of variable rate take-up increased for the seventh consecutive month while the proportion of fixed rates fell below 20% for the first time since August 2008.

Ray Boulger, senior technical manager at John Charcol, said the best value lay in tracker rates at present.

He added: “With the average difference between the best fixed rates and the initial rate on the best trackers around 1.5% in favour of trackers, it will currently take a substantial rise in bank rate for a borrower who takes a tracker to be worse off than one who opts for a fixed rate.”

Boulger said the bank base rate is likely to stay very low for quite some time, making the need for quality advice more important.

He added: “Generic advice on whether to take a fixed often simplistically states that if you cannot afford a rise in rates then you should take a fixed rate. When there is a gap as wide as in today’s market, being generic can easily be misleading. A key part of our service will be to advise our clients when we think they should switch.”

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