UK homeowners are rushing to remortgage as speculation over interest rates continues to swirl. New figures show that July saw the largest number of remortages completed in more than a decade.
Those homeowners who were able to complete a remortgage in July got in just ahead of the August rise in the Bank of England’s base rate that saw the immediate knock-on effect of an increase in mortgage interest rates.
While the Bank’s monetary policy committee decided at its September meeting not to increase the base rate any further for the moment, the mood music in the finance industry is that rates – after being at historic lows since the 2008 financial crash – are inexorably going to rise. That is likely to be exacerbated by the UK’s departure from the EU in 2019 with the economic uncertainty that will bring.
Strongest July in a decade
UK Finance, the trade body for the finance industry, revealed the remortgaging figures in its monthly report on the mortgage lending market.
Jackie Bennett, its director of mortages, said: “The residential remortgaging market saw its strongest July in over a decade, as homeowners pre-empted the latest Bank of England rate rise by locking into attractive fixed-rate deals.”
In July, 46,900 homeowners borrowed a total of £8.7 billion to remortgage. The numbers borrowing was up by almost a quarter (23.1 percent) on the same month a year ago while the amount they borrowed was also up by 26.1 percent.
Reflecting the slight stagnation in the UK home-mover market, the number of new home-mover mortgages was down by 3.8 percent, to 32,600. Those moving home borrowed the same amount as a year ago, £7.3bn.
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