Remortgaging in August '30% up on last year'
Tuesday, 11 October 2011 03:28
Remortgaging continued to increase in August, jumping more than 30 per cent in both number and value compared with the same month last year, it has been revealed.
Latest figures from the Council of Mortgage Lenders (CML) showed 34,100 remortgage loans worth a total of £4.2 billion were taken out over the four weeks.
House purchase lending also rose over the course of the month, with 52,000 loans worth £7.9 billion advanced, up from 51,000 worth £7.7 billion in August 2010.
This figure also represented a seven per cent increase in July, when the total stood at 48,700 loans worth £7.2 billion.
Meanwhile, the number of loans to first-time buyers rose five per cent compared with July 2011 and nine per cent compared with last August.
The CML said worries about the fragile state of the European economy were causing a decrease in housing market confidence, echoing recent findings from the Royal Institution of Chartered Surveyors.
It added that the recorded increase in mortgage and remortgage activity is most likely as a result of the current low rates of interest.
Paul Smee, director general of the CML, commented: "Even though it is impossible to ignore the knocks to confidence emanating from the Euro zone, August lending showed welcome signs of life.
"With those moving house experiencing a record low in the proportion of their income needed to pay their mortgage interest, it is clear that the low rate environment is a benefit to those with mortgages, even against the backdrop of the gloom in the wider economy," he added.
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