Mortgages Direct's latest research reveals that an increasing number of borrowers opted for tracker and variable mortgages with an 8% increase in applications for tracker mortgages and a 6% increase of mortgage applications for variable mortgages in May from April 2005. The changing trend in the popularity of variable and tracker mortgages reflects that mortgages borrowers are more confident that interest rates will drop.
Peter Gladdy, Director of Mortgages Direct comments: "Despite the Bank of England's decision today to freeze interest rates, with the substantial increase in the percentage of borrowers opting for tracker and variable mortgages over the past month, it appears that consumer confidence has switched and there is a growing belief that the Bank of England will decide to lower the interest rates in the imminent future."
In light of Mortgages Direct recent findings and the impact the current rates are having on the housing market Peter Gladdy calls for interest rates to drop.
He continues: "Homeowners are still suffering from last year's interest rate hikes and with an increasing number of homeowners expecting a drop in interest rate levels, now is the time for the Bank of England to adjust them. The market can not sustain rates at this level in the long term."