Most lenders still have variable rates

However, in a mixed picture of home ownership, Moving Intentions also shows that a similar number have taken steps to guarantee repayment of their homeloans.

Around 49% of homeowners questioned for Legal & General’s long running poll said they pay a variable rate of interest for their mortgages which can change immediately when base rates rise or fall. A further 9% said their mortgages are adjusted on an annual basis to take account of interest rate changes in the intervening period. Only 37% of homeowners had taken control of their homeownership costs and stabilised their budget with a fixed or capped rate mortgage.

However, while only just over one third have taken steps to control the cost of their mortgages, over half (54%), have put arrangements in place to ensure their mortgages will be paid off. 46% have repayment mortgages which ensure the capital is paid off bit by bit over the term and another 8% are paying additional lump sums to reduce the balance of their loans.

Stephen Smith, Director Housing Marketing said, “The first fixed rates were available to UK homebuyers in 1989. They have therefore become popular among British homeowners in a relatively short space of time. However this popularity extends very much to shorter term products, up to five years in the main. It will be some time before the UK homeowning public is willing to lock themselves into long term rates, particularly 25 year rates.”