60% of mortgages were purchases in July

More than six out of 10 mortgage in July were for purchase, data from Charcol.co.uk reveals.

The firm believes it is the highest level in decades and that August will be even higher.

Drew Wotherspoon, director of marketing at Charcol.co.uk, says these figures will dampen talk of a double dip recession.

He says:  “Whilst we have limited new stock demand will always outstrip supply in the UK. The last few years have taught us to expect anything, but a further large drop in prices looks very unlikely, unless the Financial Services Authority’s proposed rules on affordability are implemented as currently drafted.”

Remortgaging accounts for just 40% of the market compared to 75% two years ago.

Wotherspoon adds: “Even with the improvement in pricing of fixed rates recently, borrowers are showing little signs that they believe it is time to take long term security.  

“Despite the best attempts of some market commentators to scare the entirety of UK borrowers by suggesting we could have 8% interest rates soon, variable rates are still, in our opinion, the product of choice.  For the record, we would be surprised if bank rate was anywhere near that level by the end of 2015.”

The number of first time buyers increases by 80% in one month, the highest level since February.