Remortgage activity, along with other lending activity, is up during the first quarter in a year on year comparison, according to the latest data from the Mortgage Advice Bureau.  Remortgages are up almost 20% compared with the same time last year.  Competition among lenders is quite keen within the housing market while other sectors are still struggling to make recoveries as well.

Lenders are maintaining their level of creativity, as they see this as a way of increasing lending.  The amount of products is representative of more creative thoughts about products.  The number of products for mortgage and remortgage has increased.  The Funding for Lending scheme has also made an impact with the number and types of products.  The month of March saw an increase in the number of products by 20%.  This is compared with the same time last year and prior to the Funding for Lending scheme which was launched in August.

The MAB report also indicated the average fixed rate has dropped and the average income per household has also increased.  These two pieces of data are both fundamental to increasing the level of activity with the housing market.

Brian Murphy, head of lending at MAB, commented on lenders and borrowing in general, saying: “There has certainly been no shortage of options when it comes to selecting mortgage products so far this year. Lenders have served up a feast of offers that have fed consumer demand with some exceptionally low fixed borrowing rates.”

Murphy added: “What we need are greater helpings of funding for people on the fringes of the market, who are either knocked back because of strict criteria or scared off by towering deposits. We are almost halfway through the FLS, but despite the incentive to increase lending, the average borrower is still putting up almost 30% of their property’s value as a deposit.”