It found that five-year fixed rate remortgages accounted for 37% of the market in February, a significant fall from the 45% in January. This is the lowest level seen since July 2017.
However, interest in two-year deals is rising. Almost a quarter (24%) of remortgaging borrowers went for a short-term fixed rate deal, up from 22% the previous month. This is the highest level seen for seven months.
The research suggests homeowners are prepared to remortgage more frequently in order to secure a good deal. Last February, almost one in five borrowers said they expected to remortgage again in eight years’ time, but this has now fallen to 10%.
In contrast, almost two in five borrowers plan to remortgage in five to six years’ time, up by 11 percentage points from February 2017.
Nick Chadbourne (pictured), chief executive of LMS, suggested the increased interest in two-year deals is likely a result of borrowers offsetting the cost of November’s base rate increase by moving to a short fixed rate remortgage.
He continued: “Few borrowers will want to risk a variable rate mortgage with potential increases to the base rate likely to be on the way later this year, but with incomes squeezed, demand for longer term fixed deals has slipped.”
Elsewhere, the report found the number of remortgagors jumped by 55% in January to 49,800, the highest level recorded since 2008. Year-on-year the number of remortgagors increased by 19%.
In addition the value of remortgaging jumped 62% month-on-month to £8.9bn.