Monthly remortgaging hits post-recession high

Monthly remortgaging hits post-recession high

The total value of remortgages in a month topped £6 billion this October for the first time since July 2009

The figures from Legal Marketing Services (LMS) say the value of remortgages is up nearly 49% compared with October last year, hitting a high of £6.1 billion, – 20% higher than September’s £5.1 billion.

The number of remortgages has also risen with 37,744 recorded in October 2015, 22% more than in September and 40% higher than October last year.

LMS’s Chief Executive, Andy Knee, puts the growth in prices down to the shortage in housing stock, saying: “Remortgaging is back with a bang and rightly so as borrowers capitalise on the competitive offers currently available.

“But we’re nowhere near pre-recession levels when monthly lending frequently exceeded £10 billion, showing that there is plenty of capacity for continued growth over coming months and years.

“We have all the right conditions in place for a remortgage resurgence; lender appetite for growth in business; a plethora of competitive deals available in the market; and homeowners sitting on unparalleled housing stock value, which surpassed £5.1 trillion in August of this year.

“The general increase in all segments of the lending market is further underpinned by a general sense of economic prosperity. For now we await the release of the Chancellor’s Autumn Statement to gauge whether there will be a change in housing policies which could impact activity in the New Year.

“So far, government policies, like extending development rights to convert offices into residential units have offered some respite, but we can’t escape the fact that a severe shortage lies at the heart of the housing challenge, further compounding a growing inequality between the haves and have-nots.”

Elsewhere Buy-to-Let lenders Paragon Group have also reported their buy-to-let lending has more than doubled in the year ending 30th September 2015 compared with the same period ending in 2014. The lender reported total mortgages of £1.33 billion compared with £656.6 million.

John Heron, Managing Director of Paragon Mortgages, said: “Access to retail markets through Paragon Bank has provided the Group with a material diversification of funding. This has helped facilitate a step change in buy-to-let lending driven by a significant broadening of our product range and a more consistently competitive position for both large-scale professional landlords and smaller-scale property investors.

“It has been a fantastic year for the Group overall and with our acquisition of Five Arrows Leasing through Paragon Bank, there will be more exciting opportunities to come.”

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