The study found that one third of users questioned would still opt for a medium term fixed-rate mortgage (between five and 10 years) despite the fact that interest rates have hit new highs.
According to the research 25 per cent of those questioned said they would carry on choosing a short term fixed-rate (up to five years) mortgage regardless.
James Caldwell, director of Fairinvestment.co.uk commented: "Our research was surprising considering how high mortgage rates are in the current market. For 25% of our respondents to say they would choose a short term year fixed-rate, despite the fact they are unlikely to find a rate under 7%, suggests that people do not have much confidence in the chances of the mortgage market recovering within the next five years."
As rates increase, so too are mortgage set-up fees which are pushing potential first-time buyers out of the market. This was reflected by the research which showed that 8% of those questioned cannot afford to buy a house at all.
Caldwell commented: "Mortgage set-up fees have got to come down, as the Chancellor recently stated, lenders are taking advantage of borrowers by charging as much as £2,500 just for arranging a mortgage. With such costs, it is no surprise that the number of people who cannot afford to buy is relatively high."
