Consumers seem confident that mortgage rates will go down, according to the lender's poll.
Customer demand for three-year fixed rate mortgage deals has increased threefold over the past six months, Abbey has said.
According to Britain's largest mortgage lender, 21 percent of homeowners questioned by a recent poll said that they would opt for a three-year product, while nine percent were looking for a two-year fix and just eight per cent wanted a five-year fix.
This unwillingness to be tied in to a long-term deal suggests a confidence that mortgage rates will fall, and reflects moves by lenders including Abbey to reduce their deals over the past few weeks. Other home loans firms which have cut their rates recently include HBOS, HSBC and the Woolwich building society.
Moreover, with inflation expected by analysts to ease from its predicted high of five percent later in the year, the Bank of England is also thought to be planning cuts to the base rate in months to come - providing a further inducement for lenders to offer cheap loans.
Commenting on the research, director of Abbey Mortgages Phil Cliff acknowledged the fact that many mortgage firms had reduced their rates recently, and said that this seems to have "inspired the confidence of borrowers".
However, figures from the Bank of England, released yesterday, suggest that overall levels of market demand remain low, due to the credit crunch and general economic downturn. According to the new data release, mortgage approvals levels for July were 71 percent lower than those of a year before.
Compare mortgages via money.co.uk
