The FSA's latest Statistics on Mortgage Lending, released today, reports that 31.49% of residential mortgages outstanding were at fixed rates at the end of the fourth quarter of 2010, implying 68.51% at variable rates.
The form sent to lenders asks them to split outstanding balances between fixed and variable rates. There is no reason to think that respondents would wrongly classify balances that have moved from a fixed rate to the lender's standard variable rate in the former category.
The FSA statistics are similar to those collected independently by the Bank of England. In its December Financial Stability Report, the Bank stated that "around two thirds of outstanding mortgages in the United Kingdom have floating interest rates, somewhat above the average over the past five years".
The Bank's figures extend back to 2004, when the floating-rate proportion was 73%, according to an article published in March 2010. It fell to a low of 52% in 2007.
Monthly estimates can be derived from the Bank's statistics on average mortgage interest rates – see chart. The rise in the floating-rate portion has slowed recently. The FSA reports that fixed-rate lending accounted for 45.93% of new mortgages in the fourth quarter of 2010, up from 37.39% in the first quarter.
The claim that 90% of mortgage borrowers are exposed to a rise in Bank rate appears to be incorrect. The pass-through of higher official rates to standard variable rates, moreover, may be smaller than in the past, partly reflecting the current record 3.5 percentage point spread (i.e. the average SVR was 4.02% in February, according to the Bank).
