Tracker and SVR favoured by young buyers
Tracker mortgages are a popular choice for borrowers aged 18-24, according to new research.
They are twice as likely to take on the risk of fluctuating interest rates on their mortgage repayments, compared to any other age group.
In a survey of over 2,000 UK homeowners, USwitch found that 17.82% of homeowners aged 18-24 had taken out a tracker mortgage, 13.67% more than those in the 25-34 bracket.
Homeowners aged 18-24 likewise opted for standard variable rate (SVR) at 25.74% and 14.85% respectively.
They were also the least likely to take on fixed-rate mortgages, even though they are the most popular mortgage option across all age brackets. More than half of every other age bracket said they had a fixed-rate mortgage, but only 41.58% of 18 to 24-year-olds chose the same deal.
At 7.47%, homeowners in the 45-54 age bracket were the second most likely to choose tracker mortgages. SVR mortgages were also found to be more popular in this bracket, with 20.24% saying they had taken these mortgage plans.
Additionally, 18 to 24-year-olds were found to spend an average amount of £1,390.90 in monthly mortgage repayments, 59% higher than the 25-34 bracket, where the average monthly payment is £874.35.
Meanwhile, more than 1 in 5 (6.56%) of those 55 or older have taken tracker mortgages and over a third (35.66%) chose SVR mortgages. This age bracket had the cheapest monthly payments, averaging just £763.79.
