Remortgage lending in August fell 14.8 per cent to £3.2bn from July’s £3.8bn, but has still risen by eight per cent from August 2012, according to the LMS Mortgage Report.
While total gross mortgage lending has remained steady at £16.6bn, the remortgage market now accounts for a fifth of this lending.
The total number of remortgage loans has decreased in August to 21,682 from 27,000 in July – a drop of 19.7 per cent.
Despite the fall in the total number of remortgage loans taken in August, the average loan amount has increased by 2.4 per cent since July, now standing at £149,367. This represents a 10.3 per cent increase on August 2012.
August saw a decrease in the frequency of remortgages from July. Borrowers in August we remortgaging on average every 4 years 11 months which represents a drop in frequency of 5.4 per cent from July. However, this is still below the 5 years 2 months average recorded in March 2012.
LMS chief executive Andy Knee says: “Athough remortgage lending has experienced a noticeable knock in August there is no need to be despondent as the figures compare favourably year-on-year.
“It would appear that the entire market has reached a plateau in August, with the CML reporting that gross mortgage lending has held at £16.6bn. The remortgage market’s contraction means that remortgages only represented a fifth of the market in August, but we will no doubt see further reshuffles in the months to come.”