A total of 1,825,082 searches across all types of mortgage borrowing were recorded during October, 12% higher than the same period last year, with residential remortgaging accounting for 820,865 searches, according to Twenty7tec’s Mortgage Market Snapshot.
Despite the monthly slowdown in remortgaging searches, existing homeowners reviewing their mortgage options accounted for 45% of adviser search activity.
Residential purchase searches fell 4% month-on-month and 1% year-on-year, while first-time buyer searches remained broadly stable, increasing 1% compared with last October.
Twenty7tec’s criteria data also highlights the varied circumstances advisers are navigating. Joint borrower sole proprietor (JBSP), visa applicants and foreign nationals remained prominent, alongside searches relating to adverse credit and missed payments.
Overall buy-to-let (BTL) search activity fell 7% year-on-year, while BTL purchase activity fell 25%. BTL remortgage searches, however, remained 2% higher than October last year.
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The findings follow the latest Bank of England figures, which showed remortgage approvals rising from 34,000 in August to 42,600 in September, while house purchase approvals declined from 54,800 to 53,400.
The effective interest rate on newly drawn mortgages also increased to 4.63%, highlighting the changing borrowing environment facing homeowners.
A broker survey by HSBC revealed that borrowers were adding years onto their mortgage term to afford a more expensive interest rate when it was time to renew their product.
Nakita Moss (pictured), head of lender at Twenty7tec, said: “October’s figures show a mortgage market that remains active, but not necessarily in the areas we might traditionally expect. Remortgaging continues to drive significant annual growth, with existing homeowners reviewing their options as mortgage pricing and financial circumstances change.”
The Bank of England will announce the base rate later today. It is widely expected that the rate-setters will increase the base rate from 3.75% to 4%.
