Remortgaging activity reached 21 per cent of the valuations market in March, up from 15 per cent in March 2016.
New research from Connells Survey and Valuation found a surge in remortgaging during March, comprising up to 21 per cent of the valuations market. Buy to let mortgage valuations were up 3 per cent on a typical March as landlords hit by the loss of mortgage tax relief attempt to raise funds.
Inflation has climbed to its highest level since September 2013, resulting in homeowners attempting to offset the rising cost of living through methods including remortgaging in order to decrease their monthly mortgage repayments.
Property values are increasing at 6.2 per cent annually, and this, coupled with a low base rate, has meant that many are attempting to save through remortgaging at a lower loan-to-value ratio. Furthermore, the latest CML figures which show a 22 per cent rise in the value of remortgage activity, supporting the trend.
Corporate services director of Connells Survey & Valuation, John Bagshaw, said: ‘Remortgaging rallied in March. As the cost of living rose, consumers started to hunt ways to reduce outgoings. Food prices have been increasing at their fastest pace in three years while fuel prices have jumped 18 per cent annually. Faced with a spike in bills, homeowners have been forced to become more frugal. For those struggling, remortgaging can offer tangible financial relief. Buy-to-let remortgage valuations have also seen a slight uptick. While buy-to-let valuations are at half the typical average for March, those who have decided to stick it out in the sector are trying to recoup the loss of mortgage tax relief. With market rents not yet rising, one of the few alternatives has been to remortgage. More landlords have taken this path in March, given the lower cost of borrowing and higher property values.’