The number of approvals for remortgaging fell 7.3% in June to 48,000, The Bank of England’s Money and Credit data for June has found.
Despite this fall, remortgaging approvals remain broadly in line with the average over 2018 so far.
Matt Andrews, managing director of mortgages at Masthaven, said: “With mortgage approvals holding steady, it’s clear that consumer appetites remain strong as borrowers take advantage of the various competitive rates and products available on the market.
“Although remortgaging fell in June, it still represents the bulk of this activity, largely due to the anticipated Bank of England rate rise. While timescales for this change aren’t clear, brokers should see this as an opportunity to reengage with their back-books.
“For example, the self-employed is a category that will benefit hugely from having these conversations with brokers.
“These individuals require bespoke advice that is based on their individual circumstances, as well as access to a more common-sense approach to lending.
“This will help this group to secure a new mortgage before the impending rate rise, which will only add to the overall growth of consumer borrowing.”
In June, the annual growth rate for mortgage lending remained unchanged at 3.2%, and has now been around 3% since late 2016.
Although this is above the growth rate between 2009 and 2013, it remains modest compared to the pre-crisis period. In value terms, households borrowed an extra £3.9bn secured against their homes in June, which slightly exceeds the average of the past year.
The number of mortgages approved for house purchase increased a little in June, to 66,000, and were close to their average since late 2013.
This data gives us an indication of how much new mortgage lending we might expect to see in coming months.
Mark Harris, chief executive of mortgage broker SPF Private Clients, said: ‘Remortgaging fell a little in June and with an interest rate rise unlikely when the Monetary Policy Committee meet this week, this lack of pressure to secure a fixed rate as protection against rate rises may continue in coming months.
“However, there is no room for complacency as another bout of positive economic data could strengthen the argument for a rate rise.
“The good news is that there are still plenty of attractive deals to tempt borrowers, with lenders offering some great summer sizzler mortgage products.
“5-year fixed rates, in particular, are still very competitive with a number pegged at less than 2%, providing security from potential rate rises over the medium term.”
Jeremy Leaf, north London estate agent and a former RICS residential chairman, said: “The Bank of England data is interesting as it depicts a delicate balance between buyers and sellers.
“We are certainly not seeing any fireworks on the high street but more activity away from the centre of London, in particular, which is offering better value for money.
“Others are taking the opportunity of softening prices and considering areas and property types which they wouldn’t normally be able to aspire to.
“Looking forward, there is no great expectation of radical change as we move into the traditionally quieter summer period, although we do anticipate the usual upturn in September/October, particularly if the outlook for Brexit is more settled.”