SPECIAL FEATURE: We need more products

Mark Carney, our Bank of England governor, has started to warn repeatedly about the base rate rising in the next year or two, and as we know this will inevitably start to affect the money market pricing for mortgages well in advance. My own prediction is that this will happen within 2014.

The time is now right for lenders to offer borrowers a wider range of fixed rate products for the longer term, across all loan to values.

I am sure we are going to see more product innovation and features to help people adapt back to a normal interest rate environment.

A great deal of borrowers are on standard variable rates with little or no products to move to, particularly on buy to let mortgages.

The Government should also start to push this message as well, where possible.

Yes, the coalition are trying hard to boost everyone’s confidence in the housing market, but loans need to be affordable for the long term and right now, and that means more fixed rate options.

At Knight Frank Finance, re-mortgaging represented around 20% of our business during the recession, until the last 9 months that is.

It now represents more than 50% of our work, reflecting the increasing concerns of our clients on rising interest rates.

In fact, this is now the most common topic of conversation in our client meetings and increasingly 5-year-plus fixed rates are the product of choice.