Fast facts
£364.09 average monthly payment increase for those who remortgaged in June
47% of borrowers increased their loan size in June
45% of those who remortgaged took out a 2-year fixed rate product, the most popular product last month
26% said their main aim when remortgaging was to lower their monthly payments, making it the most popular response.
Remortgage loan sizes
Change in loan size reported by borrowers
47% increased their total loan size
33% saw no change in their total loan size
21% reduced their total loan size
Average loan increase post remortgage: £20,545
Average loan decrease post remortgage: £14,124
Monthly loan repayments
Change in monthly loan repayments reported by borrowers
67% increased their monthly remortgage repayments
9% saw no change in their monthly remortgage repayments
24% reduced their monthly remortgage payments
Average monthly repayment increase: £364.09
Average monthly repayment decrease: £305.71
Regional trends
The average remortgage loan amount in London was £360,297, while the average for the rest of the UK stood at £173,842 making remortgage loan amounts 107% higher in London than in the rest of the country.
The longest previous mortgage length was found in London at 75.91 months (6.33 years), while the shortest was in the West Midlands at 63.23 months (5.27 years), making the longest previous mortgage term 20% longer than the shortest.
Average remortgage amount: £210,410
Average length of previous mortgages (months): 67.05
Average length of previous mortgage
Region
Months
Percentage change from May
Total
67.05
5%
East Anglia
65.68
5%
East Midlands
66.53
12%
London
75.91
5%
North East
69.35
20%
North West
68.09
6%
South East
64.90
-1%
South West
65.72
0%
Wales
68.66
9%
West Midlands
63.23
3%
Yorkshire
68.00
14%
Average remortgage amount
Region
Average Remortgage Amount
Percentage change from May
Total (all regions)
£210,410
3%
East Anglia
£236,272
2%
East Midlands
£169,848
2%
London
£360,297
-4%
North East
£133,267
1%
North West
£166,279
6%
Northern Ireland
£125,896
1%
Scotland
£152,467
3%
South East
£268,085
2%
South West
£181,972
-9%
Wales
£158,041
4%
West Midlands
£174,430
8%
Yorkshire
£145,341
0%
Product Transfers Continue to Win the Day, a Trend Not Likely to Reverse Until Schools Return
As predicted, we have seen a reduction in remortgage activity and it’s a trend we can expect to continue over the coming months. Whilst the scaremongers out there would have you believe borrowers are sitting waiting to see rates drop, the reality is that we are in a quiet phase for product expiries, and product transfers continue to win the day whilst lender margins are tight. The stability of a new government, an expected rate cut towards the end of the summer, and increasing lender competition will start to reverse this activity trend. However, I don’t expect this to happen until the kids are well into the first term of their new school year.
Borrower expectations for interest rate increases
36% within the next year
14% more than a year away
50% no expectation for a rate increase
Product Purchasing
45% 2-year fixed
42% 5-year fixed
1% 10-year fixed
4% Tracker
Fixed-rate purchase motivations
75% I wanted the security of knowing how much I’ll be paying each month
10% I am worried about the economic climate and wanted to lock in a fixed rate
11% my broker recommended this
Primary goal when remortgaging
26% lower monthly payments
26% release equity on property/borrow more money
17% security over monthly payments/lock in a good deal now
Methodology
LMS’ UK remortgage lending estimates are forecasts based on our up-to-date internal conveyancing data covering thousands of remortgage completion transactions.
Established for over 30 years, LMS is one of the UK’s leading providers of conveyancing services. We offer a range of solutions for the entire conveyancing market, enabling a slick, secure, and seamless journey for all parties.
This article was published by LMS as part of their advertising agreement with Today’s Conveyancer.
The views expressed in this article are those of the submitter and not those of Today’s Conveyancer.
