Remortgaging increases 73% in a year

Increasing numbers of homeowners are staying put and choosing to remortgage rather than moving house, figures out today show.

The British Bankers' Association (BBA), whose members account for two-thirds of all mortgage lending, said that only half of all loans approved in September were for house purchase, whereas three years ago they had made up 68% of all lending.

Remortgaging meanwhile was up 73% by value on the figure for September last year, while loans for house purchase increased by just 22%.

"This is a continuation of the trend we have seen for some time now. It would seem that increasing numbers of home owners are seeking out better deals on their existing loans," said BBA's executive director, Simon Pitkeathley.

"They may also be choosing to 'build that extension' rather than move to a bigger property. This could be a reflection of continuing resistance to paying the current going rate for property."

The average value of a loan for buying a house also fell for the third consecutive month during September to reach ?86,000, perhaps suggesting that house prices are starting to come down or that people are less willing to borrow large sums of money to buy.

Total mortgage lending of just over ?13bn in September was 8% lower than August's figure, but 34% up on the same month in the previous year.