Remortgaging hits five-year low
Levels of remortgaging have reached a five-year low as lenders get more successful in retailing customers, the Council of Mortgage Lenders said.
CML figures for September show that remortgaging accounted for 30% of the market by value - the lowest figure since August 2001 and down from 42% in September last year.
In the last three months, remortgaging accounted for just 31% of the market down from 39% in the third quarter of last year.
The sharp drop reflects a trend for lenders to retain customers for longer by reducing the incentive to remortgage to other lenders, the CML said.
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Fixed-rate deals are also on the decline. In the third quarter of this year they accounted for 60% of all loans, compared to 70% in the second quarter. The average interest rate on a fixed-rate mortgage reached 5.24% in September, up from 5.18% in August.
The number of loans to first-time buyers fell to 31,100 in September, from 35,200 in August. This is down from 34,700 in the same month last year.
Loans to home movers followed the same trend, falling from 66,100 loans in August to 56,700 loans and from 57,300 loans to home movers in September 2005.
"Today's figures show that slowly but surely the market is cooling as we approach the end of the year in an environment of higher interest rates," the CML said.
