David Hollingworth (pictured top left), associate director at L&C Mortgages, noted that tracker applications had risen sharply in April, reaching a little over 14% of applications, more than three times the level recorded in March.
“The story for mortgage rates has understandably focused on the sharp spike in fixed rates since the outbreak of the Iran war,” Hollingworth said. “The threat of the rising cost of living has heightened market expectation that interest rates will have to rise or remain higher for longer.
“In recent weeks, fixed rates have begun to ease back, and there are still lenders feeding through improvements to fixed rates. Whether that will continue is far from guaranteed, as swap rates have edged higher amidst ongoing uncertainty.”
The base rate decision is only part of the advice conversation. Borrowers are weighing certainty against flexibility, particularly where tracker products come with no early repayment charges. Some are using trackers as a short-term position while they wait to see whether fixed-rate pricing improves.
Nicholas Mendes (pictured top right), mortgage technical manager at John Charcol, however, said borrowers should avoid reading too much into one Monetary Policy Committee decision or one round of lender rate cuts. Mortgage pricing, he pointed out, is still being influenced by swaps, funding costs and expectations for where rates go next, not only by the headline Bank Rate announcement.