Analysis by Stonebridge found that 12% of borrowers took out tracker mortgages in April, up from 4% a year earlier.
According to the network, this indicates that many borrowers are not at the limit of household affordability and can afford to see rates climb but are confident that the conflict and subsequent inflation shock will end relatively quickly.
The Bank of England voted to hold the base rate at 3.75% at its latest committee meeting. The average two-year tracker sits at 4.55%, Moneyfacts’ data shows.
Meanwhile, inflation currently sits at 3.3%, remaining above the 2% target, with some institutions predicting a further rise as higher fuel and energy bills take effect.
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‘Inside track’ on borrowers’ views
According to Stonebridge, the proportion of fixed rate deals fell to 87.6% last month, two months after the US attacked Iran, down from 95.4% 12 months earlier. This compares with a share of 5.5% for variable rate deals in Q1.
Rob Clifford, chief executive of Stonebridge, said: “It’s a fascinating time to be a mortgage adviser. At times like this, borrower preferences can give you an inside track on what people really think geopolitically.
“At the moment, they are signalling that they believe the worst may be over. Borrowers are increasingly willing to take on a little more risk for the chance of lowering their monthly payments when the crisis ends and rates start coming down.
“This is valuable intelligence for advisers, not because all borrowers are the same but because it underlines how important the question of risk is for customers and how we must not assume that all borrowers are risk-averse. A first-time buyer and someone with a 95% LTV may have identical opinions on international events, but they might be in completely different camps when it comes to product type.”
