Editor's note: This brief was summarised by The Property AI Newsroom from a report by PropertyWire. Read the original article for full details.

More UK Buyers Choose Two-Year Fixed Mortgages Despite Higher Rates

Property buyers in the UK are increasingly selecting two-year fixed-rate mortgages, even though these products come with higher interest rates compared to longer-term deals. This trend is highlighted by new data from Moneyfacts, as reported by PropertyWire.

According to Moneyfacts, the proportion of website users comparing two-year fixed-rate mortgages rose from 48.4% in February to 55.6% in May. In contrast, demand for five-year fixed-rate mortgages fell from 27.7% to 21.8% over the same period. Searches for 10-year fixed-rate mortgages also declined, dropping from 6.5% to 4.5%.

Despite the average rate for five-year fixed mortgages being 5.68% in May—lower than the 5.78% average for two-year fixes—borrowers appear willing to pay a premium for shorter-term flexibility. The data suggests that many buyers are prioritising the ability to remortgage sooner, rather than locking in a lower rate for a longer period.

Industry body Propertymark has cautioned against making mortgage decisions based solely on rate forecasts. The shift in borrower behaviour comes amid ongoing regulatory scrutiny and economic uncertainty in the UK property market. Housing affordability remains a key concern, and mortgage product selection has become more strategic as buyers weigh immediate costs against future flexibility.

For letting agents and inventory clerks, these trends may signal increased movement in the market as buyers seek shorter-term deals and potentially look to move or remortgage more frequently. Monitoring these shifts can help property professionals anticipate changes in tenant and landlord behaviour.