Mortgage activity slows as borrowers wait for falling rates: LMS

Remortgage instructions fell by 49% in December while 17% less remortgages completed and pipeline cases fell by 10% month-on-month, according to the latest data from LMS.

43% of borrowers increased their loan size in December and 67% took out a five-year fixed rate product.

35% said their main aim when remortgaging was to gain longer term security, the most popular response.

Nick Chadbourne, CEO of LMS, commented: “While all metrics fell in December, this is somewhat unsurprising. The quieter month was both seasonal and down to the fact that the majority of borrowers were holding out to see what the new year would bring. Those who did remortgage were looking for longer term security as is evident by over two thirds of them locking in five year fixed rates.

"Moving forwards, we’re likely to see the market stabilise – the economy will likely steady in 2023 following the political volatility that dominated the last year. Mortgage rates are expected to reduce at the beginning of the year before settling back into previous dynamics against the base rate movements. Borrowers should therefore expect the first half of 2023 to bring the lowest prices for the foreseeable future and aim to lock these in while they still last.”