According to data from Twenty7tec, mortgage searches rose from 1.55 million in August to 1.68 million in September, a 7.86% monthly increase.
Annually, activity was up by 1.51%.
Twenty7tec said that while this appeared to show that the market was bouncing back, this was primarily driven by remortgaging.
Remortgage searches rose by 10.7% to 820,429 during the month and were 14.59% higher than the same month last year.
This also made up nearly half of all activity in September, accounting for 48.95% of the market compared to 43.47% during the same period last year.
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The residential market represented 610,022 of these searches, a 15.22% annual lift, while buy-to-let (BTL) remortgages rose by 12.81%.
In contrast, purchase activity softened, the firm said.
There were 547,859 non-first-time buyer residential purchase searches in September, down 8.63% from last year. Compared to the previous month, however, this was slightly higher with a 5.94% increase.
Activity from first-time buyers improved by 2.57% compared to the last month, but was 7.63% down on the year before. Additionally, searches for first-time buyer products fell from 19.24% to 18.36% month-on-month.
Twenty7tec said this was a sign of the ongoing affordability and deposit challenges faced by potential homeowners.
A similar trend was seen in BTL activity, which had 308,434 searches in September, a 4.04% annual increase.
Remortgage activity stayed steady, but purchases fell 10.82% year-on-year to make up 98,130 searches in September.
Falling interest in long-term fixes
Twenty7tec’s data showed that borrowers were less interested in long-term fixed rates, with 6-10-year products accounting for just 12.32% of the market.
This was the lowest share recorded and nearly half the 23.72% share seen in September last year.
The firm said this suggested that borrowers did not want to lock in at current rates and were hoping for better mortgage pricing in the near future.
Nakita Moss, head of lender at Twenty7tec, said: “September’s numbers need to be read carefully. Yes, overall activity is up, but it is being propped up by remortgaging. That is not new confidence – it is people playing safe, making defensive moves to secure their household finances.
“Purchases, and first-time buyer demand in particular, remain weak, and that is a concern for the long-term health of the market. The collapse in long fixes shows how sceptical borrowers are that current rates represent good value. What we are seeing is resilience, not recovery.”
Nathan Reilly, commercial director at Twenty7tec, added: “Advisers are now operating in a market where remortgaging is dominant and first-time buyers are under real strain. This is where good CRM systems and proactive client engagement become essential.
“Advisers cannot wait for clients to come to them. They need to be running their books, using data to identify who is approaching the end of their term, and starting conversations early.
“At the same time, they should be preparing first-time buyers with realistic affordability scenarios and supporting them through a tougher journey to purchase. The advisers who use technology to anticipate needs rather than react to them will be the ones who add the most value in this market.”
