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Net mortgage borrowing increased from £1.1bn in October 2021 to £3.7bn in November, show new figures from the Bank of England (BoE)

However, November’s figure is £2.9bn below the 12-month average to June and is some way off the £9.1bn of net borrowing seen in September.

October’s low figure was driven, according to the BoE, by borrowing “brought forward to September to take advantage of stamp duty relief before it was completely tapered off”.

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House purchase approvals were largely unchanged in November, at 67,000, with a value of £14.8bn, while the remortgage approval figure increased from 42,000 in October to 44,500 in November, rising in value from £8.8bn to £9.3bn.

“The fact that approvals for remortgaging rose in November shows that there are people that have either given up looking for available property to move to or that are determined to lock into a longer term-fixed rate deal before interest rates rise again,” says Phoebus Software sales manager Richard Pike.

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“This [remortgage] data only captures those moving to another lender and not product transfers, of which there are likely to be many,” adds SPF Private Clients chief executive Mark Harris.

“A significant pick-up in remortgaging is expected this year as the threat of interest rate rises combines with many people coming off existing mortgage deals,” he continues.

The BoE data also shows that the effective interest rate for new mortgages dropped to 1.50 and the rate on outstanding mortgages fell to 2.02% – both a series low.

By Gary Adams

Source: Mortgage Finance Gazette

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