New homeowner and buy-to-let remortgages, and first-time buyer and home-mover mortgages up year-on-year
Remortgaging has spiked over the last year as a significant number of fixed-rate mortgages have started to come to an end.
The findings, from UK Finance’s October edition of its Mortgage Trends Update, reveal a total of 50,500 new remortgages were completed by homeowners in the month, representing a 23.2% year-on-year increase.
Similarly, the value of remortgaging rose 22.7% in the 12 months to October, to a total of £9.2 billion.
Assisted by the Help to Buy scheme and other initiatives, first-time buyer mortgage completions continued to increase, up 8.2% compared to October 2017 with 32,900 mortgages from new buyers completed.
The number of new home-mover mortgages likewise grew, with 33,400 completed in October, representing an annual increase of 4%.
However, there was a 9% decline in the number of new buy-to-let home purchase mortgages in the month, resulting in a 20% decrease in the value of new mortgage lending.
Conversely, buy-to-let remortgaging increased by 5.4%, bringing the total value of lending to £2.5 billion; 4.2% more than in October 2017.
“Remortgaging has reached its highest level in almost a decade,” said Jackie Bennett, Director of Mortgages at UK Finance, “as homeowners take advantage of a competitive market and lock into attractive deals.”
“This also reflects the large number of fixed rate mortgages coming to an end, which is expected to continue into 2019. There has been relatively strong growth in the number of first-time buyers, with schemes such as Help to Buy providing vital support to those getting a foot on the housing ladder.
“Meanwhile the buy-to-let market has seen a continued increase in remortgaging and a softening in home purchase activity, in line with ongoing trends in recent months,” she concluded.
According to official figures from the government, more than 400,000 first-time buyers have bought using the Help to Buy scheme since its inception 8 years ago.