FTBs see summer growth as product transfers hinder remortgaging: UK Finance

First-time buyers and homemovers saw strong growth over the summer, according to the latest figures from UK Finance.

Related topics:  Mortgages
Rozi Jones
17th September 2019
sunshine summer house empty buy
"We saw the outlook for first-time buyers brighten even further as their numbers reached the highest level in over two decades."

The data shows there were 32,640 new first-time buyer mortgages completed in July, 5.8% more than in the same month in 2018.

There were 32,710 homemover mortgages completed in July 2019, 1.4% more than in July 2018.

There were 20,760 new remortgages with additional borrowing, an annual fall of 7.1%, while new pound-for-pound remortgages (with no additional borrowing) were down 12.9%. UK Finance says this has been driven by a fall in the number of fixed-rate mortgages coming to an end and the growing popularity of product transfers.

There were 5,800 new buy-to-let home purchase mortgages completed in July, 5.5% more than this time last year, and buy-to-let remortgaging rose 2% to 15,100.

David Copland, director of mortgage services at TMA, commented: “On the whole, this summer has been encouraging for the mortgage market. Lending activity remained steady whilst borrowers continued to reap the benefits of deals and initiatives geared towards their needs. In particular, we saw the outlook for first-time buyers brighten even further as their numbers reached the highest level in over two decades.

“The remortgage market is also showing growth potential. Recent market data suggests that over £77.5bn of residential and buy-to-let terms are set to mature between now and the end of the year. This makes it the perfect time for advisers to re-engage with any customers who are approaching the end of their terms to make sure they are on the best deal possible. But the industry needs to help here too; we need to ensure that advisers have all the tools they need to continue producing optimal outcomes for borrowers and therefore retain their clients.”

Vikki Jefferies, proposition director at Primis Mortgage Network, added: “A major factor behind the increase in mortgage lending is the remarkable job advisers are doing in securing optimal outcomes for clients. Professional planning is integral in helping borrowers with the financial milestones they’ll face throughout their lifetime, and it’s important we remember the crucial role advisers play in this.

“However, it’s vital for brokers to remember that financial planning spans much more than just mortgages, and there are other avenues which their business can take to help them retain clients – particularly within the current climate. For example, 60% of consumers said they’d struggle with a loss of income within six months. This signals a great opportunity for brokers to be including income protection as part of their conversations with clients and, ultimately, stand their business in good stead for the future.”

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