The Bank of England has reported a significant surge in remortgage approvals as homeowners rush to secure fixed rates before they rise further. According to the latest data, approvals for remortgaging with a different lender jumped to 51,300 in March, up from 41,200 in February, marking a sharp increase driven by fears of higher borrowing costs.
Mortgage Approvals for Purchases Edge Up
Net mortgage approvals for house purchases, a key indicator of future lending, rose slightly to 63,500 in March from 62,700 in February. This figure is marginally above the six-month average of 63,200, suggesting a modest recovery in buyer activity. However, industry experts caution that the overall market remains subdued.
Borrowing Trends
Net borrowing of mortgage debt increased to £6.2 billion in March, up from £5.2 billion in February and above the six-month average of £4.9 billion. In contrast, net borrowing of consumer credit dipped to £1.9 billion from £2.0 billion, with credit card borrowing unchanged at £0.7 billion and other forms of consumer credit falling to £1.2 billion.
Adam Stiles, Managing Director at Helix Financial Partners, commented: "People with mortgages ending their current deals are scrambling to lock in rates as far ahead as possible to avoid higher follow-on rates. Many hope rates will drop before their new deal starts." However, he noted that purchase activity remains weak: "Swathes of would-be borrowers are not buying houses. If you don't need to act, you won't." The sharp rate rises have deterred many, who prefer to wait and see.
