Low rates encouraging Brits to remortgage

24th April 2017

The Council of Mortgage Lenders (CML) estimates that gross mortgage lending reached £21.4 billion in March, up 19% higher than February’s lending total of £17.9 billion and 19% lower than the £26.3 billion lent in March last year.

The sharp fall in year-on-year lending was expected, as March last year saw significant rises in activity as borrowers rushed to beat the second property stamp duty deadline that came into effect in April.

Gross mortgage lending for the first quarter of 2017 totalled an estimated £59.1 billion. This is a 4% decrease on the fourth quarter of last year and a 6% decrease on the £63 billion lent during the first quarter of 2016.

Commenting on market conditions, CML senior economist, Mohammad Jamei, said: “Mortgage lending appears to be in neutral gear. Our gross estimate for March is £21.4 billion, and this is broadly in line with average monthly lending over the past year. Within this aggregate level, there has been a shift towards first-time buyer and remortgage customers, away from home movers and buy-to-let landlords.

“We expect this profile to continue over the short term, as low mortgage rates encourage existing borrowers to remortgage and government schemes help first-time buyers. We do not expect any marked effect from the General Election.”

Responding to the CML data, Henry Woodcock, principal mortgage consultant at IRESS, said: “There was a concern that the drop in gross lending in February would continue into March, especially given a matching decline in approvals last month.

“But borrowers continued to see the opportunity to significantly save money on their mortgage deals in the current low interest rate environment which, combined with the modest average increase in house prices, has encouraged both house buyers and remortgagers alike to secure a new mortgage.”


*2 year fixed with TSB 1.09% then 3.59% - APRC is 3.3% Max LTV is 60%. Quoted on 27th May 2020.