UK first‑time homebuyers shift to variable and tracker mortgages

In July, roughly one‑third of first‑time buyers researching mortgages on Moneyfacts were considering variable or tracker deals, up from just under 10% in February. The rise coincided with a jump in the average two‑year fixed‑rate mortgage from 5.09% to 5.74%, pushing monthly repayments on a £200,000 loan from about £1,180 to £1,257. By contrast, the average two‑year tracker rate stood at 4.80%, giving a monthly payment of around £1,146 and a saving of roughly £111 per month. Moneyfacts head of consumer finance Adam French said, “The big jump in first‑time buyers researching tracker mortgages reveals the pressure higher fixed rates are putting on the budgets of hopeful homebuyers.” He warned that future Bank of England base‑rate hikes could raise variable payments, urging borrowers to ensure they have enough budget flexibility.