Remortgage specialist LMS says the growing number of mortgage prisoners, coupled with customer apathy and historic low interest rates will serve to keep activity at less than one third of the 2003 peak.
In 2003, remortgaging reaches a peak of 1.5m transactions. LMS forecasts activity could grow from 310,000 transactions this year to close to £400,000 in 2013.
LMS chief executive Andy Knee says: “It will be a long time before remortgage activity reaches anywhere near its 2003 peak having been hit by reduced mortgage availability, lower lender SVRs as well as a rise in the number of lifetime mortgages.
“However, the FLS can already be credited with generating some excellent deals for homeowners looking for low LTV mortgages of less than 60 per cent and we expect this to continue to boost activity well into next year. There is much less evidence of increased lender appetite for mortgages above this threshold.”
Any increase in the number of ‘mortgage prisoners’ next year will “keep a lid on remortgage activity” while borrowers are less likely to consider remortgaging if there is no increase in the base rate next year.
The Bank of England base rate has remained at 0.5 per cent since March 2009.