The remortgage market showed renewed strength in May, with instructions rising by 12% compared to April, according to the latest LMS Monthly Remortgage Snapshot.
The data highlighted a steady upward trend in remortgage activity as homeowners respond to economic uncertainty and anticipated fixed-term mortgage maturities.
The month also saw a 5% increase in completions, while pipeline activity rose 3%, suggesting a robust flow of upcoming remortgages.
However, the cancellation rate crept up by 2%.
Borrowers who remortgaged in May faced an average increase of £294.29 in their monthly repayments.
Despite this, nearly half (46%) opted to increase their loan size, with the average uplift amounting to £21,474.31.
In contrast, 23% reduced their loan size, saving an average of £12,902.82, and 32% reported no change.
Loan repayment patterns also reflected the rising cost of borrowing: 59% of borrowers reported higher monthly repayments, while 29% saw reductions and 12% experienced no change.
Among those remortgaging, 47% chose a 5-year fixed-rate deal, maintaining its status as the most popular product last month.
Meanwhile, 29% of borrowers cited lowering monthly payments as their primary motivation.
Regionally, significant disparities persisted. The average remortgage loan in London reached £331,067 – 102% higher than the UK average outside the capital, which stood at £163,945.
Nationally, the average remortgage loan came to £197,076.
When it comes to mortgage durations, the West Midlands recorded the longest previous mortgage term at 80.70 months (6.73 years), while the shortest was in the East Midlands at 72.93 months (6.08 years) – an 11% difference.
Nick Chadbourne, CEO of LMS, said: “Instructions and pipelines continue to build steadily, aligning with expectations as we head into the second half of the year.
“With around 1.6 million fixed-term mortgages due to mature over the next 12 to 18 months, remortgage activity is expected to remain strong.”
He added that borrowers are prioritising stability amid market volatility: “We’re seeing borrowers take a proactive approach, with many choosing to fix for five years – a trend driven by a desire for long-term payment certainty.
“Broker conversations suggest that stability and predictability are taking precedence over short-term flexibility, which is keeping five-year deals firmly in favour.”
Chadbourne also highlighted improvements in service delivery.
He added: “Positive sentiment is also being echoed by conveyancers, many of whom report that recent investments in technology and automation tools are helping them flex their capacity to meet demand.
“These efficiencies are playing a crucial role during peak periods, smoothing transaction volumes and supporting service consistency.”
