UK homeowners are moving to remortgage in record numbers as speculation over further interest rate rises grows. July saw the highest number of remortgages in more than a decade as existing homeowners borrowed £8.7 billion when they switched lenders.
A 0.5 percent rise in the Bank of England base rate in England had inevitably brought similar increases in mortgage interest rates. While the Bank’s monetary policy committee declined to raise the base rate further at its September meeting, there is still turbulence in the economy ahead of the UK leaving the EU in 2019.
Borrowing up by a quarter
UK Finance, the trade body for the financial industry, released figures showing that remortgaging in July was the strongest since before the 2008 financial crisis. A total of 46,900 homeowners remortgaged in that month, up 23.1 percent on July 2017, and borrowing a total of £8.7bn, up more than a quarter (26.1 percent) on a year ago.
Home-mover mortgages dropped by 3.8 percent on the year, down to 32,600, but the same amount of money was borrowed for home moving, staying steady at £7.3bn.
There were 31,400 completed first-time buyer mortgages, 31,400 newcomers to home ownership borrowing a total of £5.4bn.
Discussing the figures, UK Finance’s director of mortgages Jackie Bennett said: "The residential remortgaging market saw its strongest July in over a decade, as homeowners pre-empted the latest Bank of England rate rise by locking into attractive fixed-rate deals."
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