John Charcol’s Mortgage Index also saw first-time buyer numbers leap 80% in July to the highest level since February this year, suggesting this group is willing to look at housebuying once more after the passing of the election and emergency Budget.
However, Charcol said it would wait to draw any conclusions from this one-month surge in first-time buyer numbers to see if it becomes a trend.
Remortgages remain in the doldrums, accounting for just 40% of the market compared to 75% two years ago, despite the fact that many people could be better off moving to a new deal.
In addition, the index showed that variable rates continue to dominate the market, despite the improvement in fixed rate prices recently.
Charcol said variable rates remain the product of choice despite suggestions that rates will hit 8% soon. The brokerage said it would be surprised if rates were remotely near 8% by the end of 2015.
Drew Wotherspoon, director of marketing at Charcol.co.uk, said: “For the first time in what we believe is decades, the proportion of mortgages for purchases broke the 60% barrier in July, revealing a certain confidence in the future of the market.
“There is much talk of a double dip and a large correction in the housing market still to come, but these figures would certainly go some way towards questioning this theory.”
He added: “Whilst we have limited new stock, demand will always outstrip supply in the UK.
“The last few years have taught us to expect anything, but a further large drop in prices looks very unlikely, unless the FSA’s proposed rules on affordability are implemented as currently drafted.”
