According to the latest statistics from UK Finance, re-mortgaging strengthened in July and reached its highest level since January, with customers attracted by borrowing rates that are at or close to their historic low point. The increase in activity in July means that, over the last year, the number of people re-mortgaging has been at its highest since 2009. Lending for house purchase was lower in July than in the preceding month, with the market expecting to continue to soften a little in the coming months. There was a smaller increase in both the value and volume of buy-to-let lending.
The proportion of household income taken up by monthly mortgage payments nudged upwards in July for both first-time buyers (17.4%) and movers (17.6%). But it remained low by historical standards. The average amount borrowed by a first-time buyer edged up from £138,750 in June to £139,000 in July. The average first-time buyer household income declined marginally, which means that their average income multiple nudged up from 3.59 to 3.60. The average amount borrowed by movers was unchanged at £180,000, as was their average income multiple of 3.39.
Re-mortgaging accounted for more than 70% of all buy-to-let lending in July. Buy-to-let re-mortgaging was 10% higher than in June, but overall the sector continued to reflect the more subdued levels of activity seen since the introduction of higher stamp duty in the spring of 2016.