Another week and another report out from UK Finance casts light on the state of the UK Mortgage Market. This shows that with rates nearing rock-bottom given the intensity of competition among lenders, remortgages have gone off the Richter Scale.
There was a 9.1% rise in the number of people taking additional borrowing on their remortgages compared to a year ago, which reflects the fact that a lot of people are choosing to add value to their existing homes rather than move.
While homemover mortgages were down in March, purchases have really started to gain momentum since April, with the usual late Spring lift being boosted by a growing indifference to Brexit.
While there was a slight decrease in first-time buyer mortgages, they are still generating most of the momentum in the purchase market.
We are also now seeing more activity further up the property ladder, as people’s lives have been on hold for long enough. The window shoppers of 2018 now have their wallets out and are making genuine offers.
With competition for employed borrowers rife, more and more lenders are proactively targeting the self-employed, contractors and freelancers in a bid to get funds into the market.
Many move at a glacial pace, but lenders are finally getting to grips with changing work patterns. They have to adapt their underwriting to the gig economy or they risk becoming irrelevant.
For those not in conventional employment, there has never been a better time to take out a mortgage.
Mortgage rates from lenders are subject to the usual competitive jostling and as such, the main headline rates have reduced a touch. For standard residential mortgages, borrowers can obtain 2-year fixes at 1.35%, (3.84% APRC) and 5-year fixes from 1.80%, (3.48% APRC) whilst variable tracker rates are around from 1.29%, (3.82% APRC).
Those looking at Buy-To-Let can still obtain products from just 1.39%, (4.71% APRC) for a 2-year tracker or 5-year fixes are available from 1.99% (4.40% APRC).