Official figures from UK Finance show that the new regulations regarding portfolio landlords have not slowed down remortgagors, with October seeing a 20.5% increase in the number of buy-to-let (BTL) remortgage loans, as well as a 20% rise in their overall value.
The data shows that there were 14,700 buy-to-let loans for remortgaging in October, an impressive increase from 12,200 in September and 12,100 in October 2016. At the same time, the total value of these loans was £2.4 billion, up from £2 billion in both September and a year earlier.
This is despite regulations implemented at the end of September which require stricter affordability criteria from those with more than three buy-to-let properties. It may be that the rumours of a base rate rise, which have since proven well-founded as the Bank of England increased base rate by 0.25% at the start of November, spurred landlords on to review their mortgage deal.
And with good reason, as mortgage rates have indeed risen following the base rate rise. This might also explain why remortgaging among homeowners saw a similar boost, with the number of loans up by 16.1% month-on-month in October and the value seeing a 15.9% increase.
Commenting on the data, UK Finance's head of mortgage policy, June Deasy, said: "Over the last year, the number of loans for remortgaging have been at record levels; this trend looks set to continue further as we head towards the end of 2017 and borrowers seek to take advantage of low interest rates."
In contrast to remortgaging activity, there was only a 6.5% increase in the number of BTL property purchases, from 6,200 in September to 6,600 in October. This might reflect a hesitancy to invest in new properties following regulatory changes and given the ongoing economic uncertainty.
As a result of this, the value of BTL purchases has remained at £900 million, while house buyers have at least seen some movement month-on-month (from £11.8 billion to £12.1 billion across both first-time buyers and home movers). Still, June points out that "mortgage repayments as a proportion of income still remain at or close to their historic low point, and despite the recent base rate rise we can expect monthly mortgage payments to remain affordable for the vast majority of borrowers."
So, mortgage rates may be going up, but they're still competitive compared to years gone by. Why not have a look at the buy-to-let charts to see if you could benefit from remortgaging, and don't forget the residential mortgage charts to make sure you're getting a competitive deal on your own home as well.
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