- November remortgage lending falls 23.4% to £3.1bn
- Total gross mortgage lending remains static at £12.9bn meaning remortgaging now accounts for 24% of total
- Those remortgaging are each taking out an average of £19,848 in extra equity (above the value of the redeeming loan), up 14.6% on October
Monthly gross remortgage lending fell by £949m in November to £3.1bn, according to LMS’ November Remortgage Report. This is down 23.4% on the £4.1bn reported by the Council for Mortgage Lenders (CML) for October.
According to the latest figures released from the CML, gross mortgage lending was static in November, remaining at £12.9bn. However, due to the fall in gross remortgage lending over the last month, it now represents just under a quarter of the total market (24%).
Although November’s remortgage lending figure has fallen it is still £114m more than in August 2012, when gross remortgaging lending fell to its lowest level for 12 years (December 1999). This stagnation is reflected across the mortgage market and can be attributed to a seasonal lull in homeowner activity.
The average remortgage loan amount increased moderately in November, rising by £373 to £138,573. This is a new 2012 peak. Average loan amounts have continued to rise since hitting an 11-month low in May (£128,381). November’s figure is also 5.5% higher than this time last year (£131,350 – November 2011) and the highest it has been since December 2008 (£143,126).
LMS figures indicate that the total number of remortgage loans advanced fell by 23.6% in November, down from 29,399 in October to 22,472 in November.
Commenting on the latest figures, Andy Knee, Chief Executive of LMS says:
“The number of homeowners remortgaging in November fell to its lowest level since the credit crunch but, more optimistically, the total value is still higher than the trough of the market in August 2012.
“This can be attributed to a seasonal lull in activity in Autumn as homeowners opted to delay any financial decision-making until the New Year. This is also reflected in the gross mortgage lending estimate from the CML which has reported that growth stalled following a similar burst of activity the previous month.
“In spite of a weaker than expected November for the remortgage market, we are still on course to reach our predicted 310,000 transactions this year with the FLS, general easing of funding constraints and competitive deals with finer margins contributing to growth of as much as 25% in 2013.”