The volume of remortgage applications reached the highest level since January 2009, according to Countrywide.
Speculation surrounding base rate rises saw remortgage applications make up 32% of all mortgage applications in January, a 5% increase on the previous month.
Three out of the Top 10 Mortgages applied for by customers through Countrywide’s network of 650 mortgage consultants were remortgage products and customers provided an average deposit of 32% which gave them an average interest rate of 3.26%.
Overall, the average deposit required for the Top 10 Most Popular Mortgages in January was 22 percent, with an average interest rate of 4.24% showing the difference between remortgage and house buying transactions.
Fixed rate products made up 84% of all mortgage applications in January –a 9% increase on the previous month, which saw fixed rate products reach their highest level since August 2009. A large proportion of remortgage customers also opted for fixed rate remortgage products making up 86 percent of all applications – an 8% monthly increase and the highest level since July 2009.
Grenville Turner, chief executive of Countrywide, says: “The growing popularity of fixed rate mortgage products is a telling sign that many are prepared to pay slightly more to give themselves peace of mind and stability with regards to their outgoings. Overall, the reality is that for the last two years only those that have had to move have done so.
’Discretionary movers, who typically make up somewhere around half of all transactions are beginning to evaluate whether this is now the time to make a move.”
Turner adds: “The government has set targets to increase business lending to small and medium sized enterprises, it would be equally valuable to the economy if a deal could be struck with top lenders to help buyers gain affordable mortgage finance.
“I hope the government’s First Time Buyer Summit held earlier this week addresses these key issues to incentives and stimulate the market. An immediate move to remove stamp duty on properties up to £250,000 would be a positive start.”