The number of home owners looking to remortgage hit a record high in August while the market for buyers continued to decline, according to forecasts by Connells Survey & Valuation.
The firm’s valuation data found that home owners are looking to lock in record low mortgage rates by remortgaging, with this cohort making up 37% of the market last month, increasing from 34% this time last year.
But home buyers are having a tougher time, with the proportion of valuations from people selling their property to buy another decreasing to 21% of the market, down from 25% last year.
First-time buyer numbers were flat at 33%.
John Bagshaw, corporate services director of Connells Survey & Valuation, said: “Remortgaging is quickly becoming the dominant activity in the lending market. The record high in August was driven by consumers seeking out better value borrowing.
“Having benefited from a decade of low interest rates, consumers are sensing the risk that this era is nearing an end. Many older mortgage deals are expiring this autumn which will mean moving on to more expensive standard variable rates. As a result, home owners on these deals are opting to refinance, taking advantage of the intense competition in the mortgage market right now.
“With RICS reporting a shortage of properties on estate agents’ books, some potential home movers can’t see their next home as they’re scrolling through the various property portals. That doesn’t mean people don’t want to move – there is still demand from first-time buyers, as well as people moving jobs or starting a family and looking to move up the ladder.
“But with house prices still rising – even if it’s at a slower rate – many home owners have drifted up a Stamp Duty band since they first bought their home.
“This means those at the higher end of the market are facing larger bills if they’re looking to move or downsize. As the average Stamp Duty bill now stands at around £6,000 – it’s far less affordable to move than it used to be because salary growth hasn’t kept up with property prices.”