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Equity withdrawn through remortgaging hits record high

  • 23/12/2015
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Equity withdrawn through remortgaging hits record high
The average amount of equity withdrawn through remortgaging hit a record high of £36,900 per customer in November, research from property services firm LMS reveals.

This is a rise of 4% from the previous high of £35,590 recorded in August.

The figure represents a month-on-month increase of 27% from £29,027 in October, and a 76% rise compared to the same time last year, when the average loan amount was almost £21,000.

The total amount of equity released by remortgaging reached £1.1bn in November, up 16% month-on-month and more than double the £0.5bn recorded in 2014.

While the value of monthly gross remortgage lending fell from £5.5bn in October to £4.6bn in November, it rose by 27% year-on-year compared to the November 2014 figure of £3.6bn.

The number of remortgage loans taken out by borrowers saw a similar trend. While it fell 9% from 32,100 in October to 29,363 in November, it increased by 22% compared to the 24,000 remortgages recorded in November of last year.

The average mortgage rate fell to a record low of 2.52% in October. This is lower than the 2.57% recorded in September and the 3.18% seen in October last year, which LMS said highlights the competitive offers currently available on the market.

Andy Knee , chief executive of LMS (pictured), said that while the latter part of the year has been stronger than the start, remortgaging still remains a long way off the levels seen prior to the recession.

He added that rising house prices and competitive rates leave remortgaging affordable, presenting the opportunity to capitalise on massive savings.

“Historically low interest rates and a range of new mortgage products mean the industry can be optimistic for the year ahead,” he said. “We hope this environment will generate more consistency in lending levels, something 2015 was unable to maintain.”

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