The latest Mortgage Trends Update from UK Finance reveals a strong increase in remortgaging in April 2018, with new homeowner mortgages up 36% and buy-to-let remortgages up 32.4% compared to the same month a year earlier.
UK Finance has also published a blog analysing the factors driving the remortgaging boom, which include the large number of customers reaching the end of their mortgage deal rates and speculation that the Bank of England may raise interest rates.
The month of April saw 40,800 new homeowner remortgages completed in the month, totalling £7.5bn - a rise of 44.2%, year-on-year, on the previous April.
In contrast, completed homemover mortgages were down by 4.2% compared to April 2017, and the £5.4bn of new lending fell by 3.6%, year-on-year.
There were 5,000 new buy to let house purchase mortgages completed in the month, some 5.7% fewer than in the same month a year earlier. By value this was £0.7bn of lending in the month, 12.5% down year-on-year.
Buy to let remortgages, on the other hand, were up by 32.4% on April 2017. By value this amounted to £2.3bn of lending, a 35.3% rise year-on-year.
At the same time, first-time buyer mortgages completed in April outstripped homemover mortgages in number if not in value.
Commenting on the data, Jackie Bennett, Director of Mortgages at UK Finance, said:
“Remortgaging activity bounced back to strong levels in April, as both homeowners and landlords put their house in order by locking into attractive fixed-rate deals ahead of an anticipated interest rate rise.
“This spike in remortgaging was also driven by a large number of fixed-term mortgage deal rates coming to an end, combined with increased efforts by lenders to contact their customers before their deal rate expires.
“The number of first-time buyers has grown year on year, outstripping the number of homemovers. This may reflect the impact of measures such as the recent stamp duty cut and the Help to Buy scheme that are focused on getting more people onto the housing ladder.”
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