Remortgage activity within the UK housing market is taking a back seat to mortgage lending for house purchase, according to the latest data from the CML or Council of Mortgage Lenders.  As the summer comes to an end, house purchase mortgage lending will likely slow down, but activity up to July for purchasing a house has been solid.  Both first time buyer and home mover lending remains strong as the fall months are before us.

The number of remortgages in July was up by almost 5% compared with June.  Compared with July of last year a different story emerges.  Last year at this time, remortgages were up by more than 15% compared with the data from this year.

The first time buyer group continues to be hot within the market.  The group is gaining strength when considering gross income towards property purchase, but still not as strong as they were in 2007, the year the economic crisis began to grab hold.  Almost 20% of gross income went to cover capital and interest compared with almost 25% seven years ago.

Paul Smee, director of the CML, commented on the current state of purchase power across the UK, saying: “The market has shown steady growth in house purchase and buy to let over the past few months with general improvements in economic factors across the UK allowing for more people to enter the property market.”

Smee added: “There have been many factors over the past year that could have caused disruption but the market has remained resilient and lenders have shown themselves adaptable to all this change. The CML will continue working towards making sure future initiatives affecting the market, such as the European Mortgage Credit Directive, are introduced with equally minimal disturbance to borrowers and lenders.”

Remortgage activity will likely go into overdrive as the countdown begins to the increase of the base rate, which is expected to occur within the opening months of the next year.