Homebuyer and remortgage interest declines as market awaits clarity
Mortgage search volumes declined last week, following the Bank of England’s decision to maintain the base rate, according to new figures from Twenty7Tec.
Data from the mortgage technology provider showed that standard residential mortgage searches, which represent the majority of activity, dropped by 9.4% compared to the previous seven-day average. There were 50,500 residential searches recorded, down from 55,714.
Remortgage searches experienced the largest fall, decreasing by 12.7% on the weekly average. First-time buyer searches also declined significantly, falling 10.2%. The figures suggest that ongoing affordability concerns, expectations about future rates, and uncertainty ahead of the upcoming Budget are weighing on demand from those seeking to purchase homes for the first time.
Buy-to-let searches remained steady, with 13,632 recorded compared to the previous average of 13,717. This stability resulted in landlords accounting for a slightly increased share of the market at 19.8%, up from 16.8% in August.
“The pause has certainly raised a few eyebrows, with many advisers expecting recent rate stability to boost borrower confidence,” said Nakita Moss (pictured right), head of lender at Twenty7Tec. “In fact, we are seeing the opposite.
“Standard residential searches fell 9.4%, with first-time buyer searches down even more sharply at 10.2%. Remortgage activity saw the largest drop, falling 12.7%, which suggests some homeowners are holding off refinancing in the hope that a future rate cut will improve affordability.
“By contrast, buy-to-let searches were effectively flat, which is remarkable given the headwinds landlords have faced in recent months. Their share of the market is slightly higher than the seven-day average, showing that many are taking a long-term view and are less reactive to short-term rate decisions.”
The decline in mortgage searches indicates subdued borrower confidence and fewer opportunities for new business. Mortgage brokers may face reduced client enquiries, especially from first-time buyers and those seeking to remortgage. However, stable buy-to-let activity suggests ongoing demand from landlords. Brokers should be prepared to advise clients as market conditions shift and pent-up demand potentially returns.
“This looks like a market taking a breath rather than retreating,” Moss noted. “We expect a rebound in both residential and remortgage searches as pent-up demand is released, and advisers need to be prepared to have the data at their fingertips to give their clients the best options.”
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