Remortgages up by a third in April

Remortgages up by a third in April
The number of people remortgaging surged in April as homeowners rushed to secure low mortgage rates ahead of a potential rate rise in May.

More than 40,000 homeowners remortgaged in April, according to latest figures from trade body UK Finance, up 36% compared to the same month last year. Many of these were people approaching the end of their current mortgage deals.

"Remortgaging activity bounced back to strong levels in April, as both homeowners and landlords put their house in order by locking into attractive fixed-rate deals ahead of an anticipated interest rate rise, said Jackie Bennett, director of mortgages at UK Finance.

“This spike in remortgaging was also driven by a large number of fixed-term mortgage deal rates coming to an end, combined with increased efforts by lenders to contact their customers before their deal rate expires.”

First-time buyer numbers increase

The number of first-time buyers has grown year on year, UK Finance said, outstripping the number of homemovers. Some 26,700 new first-time buyer mortgages completed in April, around 3.5% more than in the same month a year earlier. The average first-time buyer is 30 and has a gross household income of £42,000.

First-time buyers have been helped by the stamp duty cut announced in last year’s Budget, and by government schemes such as Help to Buy.

Mixed picture for buy-to-let

April also saw a sharp spike in the number of landlords remortgaging, with many seeking to reduce outgoings following changes to buy-to-let rules. These include the introduction of a stamp duty surcharge on second homes, and a reduction in the amount of tax relief landlords can claim on mortgage intertest payments.

There were 14,300 new buy-to-let remortgages completed in the month, up 32.4% compared to the same month a year earlier.
However, despite strong buy-to-let remortgage figures, the number of new buy-to-let mortgages taken out in April was nearly 6% lower than in the same month last year. Many prospective landlords have been put off purchasing rental properties due to the extra costs they face as a result of tax and regulatory changes.



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