There are now just 268 tracker rate mortgages, a dramatic fall from 294 a year ago, with the average rate at 2.15% today after creeping up from 2.08% over the same time period.
It’s thought that lenders are unsure how to price the deals with the prospect of a rising base rate, according to Charlotte Nelson from Moneyfacts.co.uk.
She said: “Back in 2009, providers were unsure of how to price their variable products and opted instead to withdraw them entirely.
“A similar scenario appears to have occurred this time around, with providers questioning how to price their deals, particularly with talks of further base rate rises this year.”
Swap rate rise
At the same time the average two-year fixed rate is at its highest level in a year with a typical rate of 2.36%, from lows of 2.17% seen in September last year.
It comes amid a rise in Swap rates, which affect both bank lending and market borrowing costs.
Nelson added: “During uncertain times, borrowers tend to err on the side of caution; opting for a fixed rate instead of leaving themselves exposed to a potential rate rise.
“This lack of demand is also depleting variable products, with providers choosing to focus on fixed deals instead.