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Remortgage activity continues to fall

Written by: Your Mortgage
Activity in the remortgage market has continued to slump with a 4% drop in the number of cases processed in the last three months.

Figures from Paragon Mortgages showed a decline in the number of remortgage cases being processed during the second quarter of the year compared to Q2 2013.

The firm said increasing activity in the first-time buyer market had been the reason for the decline.

Mortgage brokers reported an increase in the proportion of mortgages for first-time buyers since last summer, growing from 17% in Q3 2013 to 19% in the most recent quarter.

Buy-to-let deals for first-time landlords have been increasing since the start of 2014 with growth to 22%. However, buy-to-let remortgages fell four percentage points in the same period.

John Heron, managing director of Paragon Mortgages, said: “The declining proportion of remortgages against the increased proportion of first-time buyer mortgages represents a continuation of a trend that has been apparent over the past couple of years as the market has gathered momentum.

“It is promising to see an overall increase in the proportion of buy-to-let mortgages being processed, which again highlights the steady growth we are experiencing in the market.

“There is a clear declining trend in buy-to-let remortgages, with the proportion having dropped significantly since a pre-crisis peak in 2007/08 followed by a steady and continuing decline.”

Heron said it was a positive step to see some growth in the number of first-time landlords looking to invest in the buy-to-let market to provide a strong sustainable future for the private rented sector.

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