Borrowers turned away from 10-year fixed mortgages, which made up just 12% of searches on 7th August, research from Twenty7tec found.
This was down from 13.14% in July and well below the year-to-date average of 20.6%.
On the same day, after the Bank of England (BoE) cut the base rate to 4%, mortgage searches jumped 4.4% to 72,925, compared to the previous week’s daily average of 69,863.
In the week before the rate change, activity slowed as total searches dropped 7.1% from 400,610 to 372,114 compared to the run-up to June’s announcement.
Additionally, on 7th August, 49.3% of product searches were for 2-year or shorter fixed terms, similar to July, when short fixes made up 52.03% of all activity.
Nakita Moss, lender relationships – team manager at Twenty7tec, said: “Hints that the rate would fall – and keep falling – seem to have calmed what’s been a tense and turbulent market.
“This isn’t a case of buyers retreating. It’s a sign they’re pausing for breath.
“Rather than racing to fix at the first opportunity, people are watching carefully, sensing that better deals might be just around the corner.”
Nathan Reilly (pictured), commercial director at Twenty7tec, said: “We’ve spent the last couple of years talking about certainty – and how attractive it is in a volatile economy. But now the conversation is shifting.
“If rates are likely to come down again, many borrowers are happy to ride things out a little longer, even if it means shorter terms or more frequent remortgaging.
“Without context and expertise, this behaviour from end customers makes sense, but in reality, advisers know that there is more to mortgage pricing than just the base rate narrative – which in its own right, seemed to soften yesterday.”
Reilly added: “This is where advisers will need to play an important role in educating customers on the fact that the wait and see approach, may transpire to be more wishful thinking.”
