Remortgaging Surge Drives September Mortgage Market Activity

Mortgage activity surged in September as borrowers rushed to remortgage amid rising interest rates and market uncertainty. Twenty7tec reported a 44% year-on-year jump in residential remortgage searches, with a total of 860,951 searches recorded. Overall mortgage searches rose 23% from August and 15% compared to the same month last year, driven largely by remortgaging activity.

The spike in remortgaging follows recent increases in fixed mortgage rates by major lenders, with some rates climbing by up to 0.30%. The Bank of England held its rate at 3.75% in September, though three committee members voted for an increase. Data from the Bank also showed that the effective interest rate on newly drawn mortgages rose from 4.45% in July to 4.60% in August.

Residential purchase searches saw a more modest increase, rising 8% from August but just 1% year-on-year. First-time buyer searches increased 3% month-on-month but remained 4% below last September's figures. Meanwhile, buy-to-let searches rose 27% month-on-month, with buy-to-let remortgage searches up 34%, though overall annual activity remained 4% lower than the previous year.

Nathan Reilly, chief customer officer at Twenty7tec, noted the significant role of remortgaging in driving adviser workloads. 'Remortgaging is doing a huge amount of the work,' he said, highlighting the 40% monthly and 44% yearly growth in searches.