UK Finance’s latest Mortgage Trends Update reveals there was strong growth in remortgaging in April 2018, with new homeowner mortgages up 36 per cent and buy-to-let remortgages up 32.4 per cent compared to the same month a year earlier.

UK Finance has also published a blog analysing the factors driving this rise in remortgaging, including the large number of customers reaching the end of their mortgage deal rates and speculation that the Bank of England may raise interest rates.

Key data highlights:

  • There were 26,700 new first-time buyer mortgages completed in the month, some 3.5 per cent more than in the same month a year earlier. The £4.4bn of new lending in the month was 4.8 per cent more year-on-year. The average first-time buyer is 30 and has a gross household income of £42,000.
  • There were 25,100 new homemover mortgages completed in the month, some 4.2 per cent fewer than in the same month a year earlier. The £5.4bn of new lending in the month was 3.6 per cent down year-on-year. The average homemover is 39 and has a gross household income of £55,000.
  • There were 40,800 new homeowner remortgages completed in the month, some 36 per cent more than in the same month a year earlier. The £7.5bn of remortgaging in the month was 44.2 per cent more year-on-year.
  • There were 5,000 new buy-to-let house purchase mortgages completed in the month, some 5.7 per cent fewer than in the same month a year earlier. By value this was £0.7bn of lending in the month, 12.5 per cent down year-on-year.
  • There were 14,300 new buy-to-let remortgages completed in the month, some 32.4 per cent more than in the same month a year earlier. By value this was £2.3bn of lending in the month, 35.3 per cent more year-on-year.

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.”

Notes to Editor

  1. UK Finance is a trade association formed on 1 July 2017 to represent the finance and banking industry operating in the UK. It represents around 300 firms in the UK providing credit, banking, markets and payment-related services. The organisation brings together most of the activities previously carried out by the Asset Based Finance Association, the British Bankers’ Association, the Council of Mortgage Lenders, Financial Fraud Action UK, Payments UK and the UK Cards Association.
  2. The data shown is grossed up from the sample of lenders reporting to reflect total market size, based on total market volumes of Mortgage Product volumes of Mortgage Product Sales Data published by the FCA, so our historical figures are subject to revision as and when the FCA makes revisions to the market totals. The average figures shown are medians, as they tend to better represent the position of the typical borrower. Affordability measures are based on median averages of calculations for individual transactions. Capital & interest payment calculations only include mortgages taken out on a full capital and interest repayment basis and are calculated based on the reported repayment term, interest rate, loan amount and income for each transaction.
  3. Income metrics are presented on a gross household basis, as the sum of all income sources for all borrowers included in the affordability assessment.
  4. UK Finance has also published a blog (link), ‘Two speed market: when will remortgaging run out of gas?’ analysing the factors driving the recent growth in remortgaging.
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Remortgaging bounces back as borrowers put their house in order
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