Mortgage brokers say the rush to remortgage shows no signs of slowing, adding to Bank of England figures showing a continued decline in home purchases.
Net mortgage approvals for home purchases fell to 56,100 in July, down from 58,200 in June, while remortgage approvals rose to 34,500 from 34,100, according to the bank’s latest figures released on September 1.
The bank also reported that the effective interest rate on new mortgages rose to 4.45% in July, from 4.35% in June.
The latest Twenty7tec data similarly points to stronger remortgage activity as searches to buy decline. Mortgage market snapshots for July showed that overall mortgage search activity remained resilient, with purchasing activity declining while remortgaging gained momentum.
Borrowers are increasingly approaching the end of their deals early, particularly after getting a cheaper five-year fix
The technology company’s data also reflects the volatility seen earlier in the year. Mortgage searches rose to 2.15 million in March before falling sharply in April and rebounding in June. By May, residential purchase searches were down 5% month-over-month to 626,029, while residential remortgage searches were down 9% to 563,124.
A stronger remortgage market and weaker purchase market was also forecast by trade body UK Finance in its 2026-27 market forecast, which said home purchase lending would be £180bn in 2026, down 2%, while remortgages would be well below £77bn, but up 10%.
These figures reinforce what many mortgage brokers are now seeing on the ground, with borrowers nearing the end of a fixed rate deal increasingly focused on securing a new interest rate, while some potential buyers remain reluctant to commit.
“We have seen an increasing split towards remortgaging for a few months,” says L&C Mortgages associate director David Hollingsworth.
“Earlier in the year we saw interest rates improve…and you would expect a pick-up in purchasing activity as a result of that. That has been turned on its head by the renewed war with Iran. Some people who want to remortgage have pushed that decision forward.”
It’s really hard to judge the perfect time to buy. Some people are waiting for prices to drop
“So there is a lot of refinancing activity, and purchases have been muted. First-time buyers still play a major role. But it was easy for many buyers to make a case for waiting.”
“We’re definitely getting more remortgages,” says Aaron Strutt, director of product and communications at Trinity Financial. “Some of the bigger banks don’t offer particularly good transfer rates, so they leave customers with a tough choice between sticking with their lender and paying more or going through the hassle of remortgaging.”
Strutt says the reasons to remortgage aren’t necessarily limited to reaching the end of a fixed rate period. Some borrowers also use the opportunity to raise money to improve their homes or make other changes to their mortgage.
“A lot has to do with price, but also making changes to the mortgage,” he says, adding that most borrowers keep their current lender.
I’ve seen people wait a very long time and decide to buy or they will wait forever
The stronger remortgage market comes as thousands of homeowners continue to be offered fixed-rate deals agreed when borrowing costs were much lower. The Bank of England said in July that nearly 750,000 households paying less than 3% interest would exit a fixed-rate mortgage during 2026, with these borrowers facing an average rise of around £170 a month in repayments.
Borrowers are increasingly approaching the end of their deals early, particularly those coming out of a cheaper five-year fix, says Chris Sykes, director of MSP Financial Solutions.
“People take remortgaging very seriously,” he says. “We’re heavy on the remortgage side right now.”
But none of the brokers believe the buyout market is on its knees. Sykes says there are still “a large number of purchases coming through”, while Strutt says his company is still receiving a lot of purchase inquiries.
Strutt adds that some lenders are reporting that they are less busy than they would like, with major banks saying their phones are not ringing as much as expected. He says mortgage rates are still higher than hoped, creating another hurdle for buyers trying to figure out if now is the right time to move.
First-time buyers are still key. But it was easy for many buyers to make a case for waiting
“It’s really hard to judge the perfect time to buy,” he points out. “Some people are waiting for interest rates to fall.”
The bank’s latest figures support this cautious picture. Purchase approvals of 56,100 in July were below the average of about 60,800 recorded over the previous six months.
Sykes says some borrowers have spent so long waiting for conditions to improve that they have now decided to go ahead regardless.
“I’ve seen people wait a very long time and decide to buy or they’ll wait forever,” he says.
This article appeared in the September 2026 edition of Mortgage strategy.
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