First-time buyers prefer two-year fixed-rate mortgages, while those moving to their second home are likely to lock in their interest rate for five years.
This is evident from new data from Moneyfactscompare, which shows which mortgage types different borrowers considered last month.
Overall, it found that half (53%) of borrowers comparing fixed-rate mortgage deals in November 2025 were considering two-year fixed-rate options.
When we focus exclusively on starters, this has increased to 70%. And that’s no wonder, since two-year contracts have recently become cheaper than a five-year fixed rate.
Concluding a shorter-term agreement also offers more flexibility.
Adam French, head of news at Moneyfactscompare.co.uk, said the popularity of two-year deals is not surprising given expectations that interest rates will continue to fall in the short to medium term.
“At the beginning of the year,” he said, “the average two-year fixed mortgage rate was 5.48%, higher than the typical five-year mortgage rate, which cost 5.25%.
“Since then, however, two-year deals have become cheaper, with the average interest rate now at 4.86% and the average five-year deal at 4.91%. Both fell below 5% earlier this year for the first time since the mini-budget in September 2022.”
When it came to refinancing, 62% of customers were looking forward to a fixed interest rate for two years. Of those taking their second step on the property ladder, 45% were looking at fixed interest rates of five years or longer.
And despite higher overall mortgage rates, 7% of borrowers also explored fixed deals with a ten-year term, the analysis shows.
French added: “Second buyers appear to be prioritizing stability, predictability and protection against potential interest rate volatility over cheaper rates.
“They appear to be more concerned about securing long-term peace of mind, especially if they have higher borrowing levels and want to protect themselves against unexpected interest rate increases.”