Mortgages ‘now two markets’

There are now two markets in the mortgage sector, with a growing housebuying segment and falling remortgages, it has been claimed.

Council of Mortgage Lenders (CML) figures for August showed that nearly 53,000 homebuyer loans were agreed in the month, five per cent less than in July but 29 per cent more than the same month in 2008.

In contrast, the tally of remortgages – 32,000 – was down both on July’s figure (by 22 per cent) and compared to August last year (by 57 per cent).

CML economist Paul Samter said the remortgaging trends are due to the low interest rates those coming off deals are seeing.

He stated that the homebuying market has “revived” since the start of this year and is “now on a firmer footing”.

A number of lenders have recently announced they are introducing loans at lower rates.

One of these is the Coventry Building Society, which has just announced the launch of a two-year fixed-rate deal at 3.87 per cent and a loan-value level of 65 per cent.

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