Optimism remains for January
The mortgage market experienced a significant slowdown in activity in December 2024 compared to the previous month, according to adviser tech provider Twenty7tec.
According to the data, purchase mortgage searches dropped by 37.7% in the last month of 2024 compared to November, while remortgage searches fell 32.9%.
Buy-to-let purchase mortgage searches were down 35%, while buy-to-let remortgage searches declined by 35.5%. Residential purchase mortgage searches also dropped sharply by 38.4%, while residential remortgage searches saw a 32% decline.
First-time buyer searches decreased 36.7% from November levels, reflecting the typical seasonal dip during the holiday period.
When compared to December 2023, however, the picture was more mixed. Twenty7tec’s latest monthly mortgage report also showed that purchase mortgage searches rose by 9.6%, while remortgage searches were down 17.4%.
Buy-to-let purchase searches were virtually flat, up just 0.3%, while buy-to-let remortgage searches fell 6%. Residential purchase searches grew by 11.4% year-on-year, while residential remortgage activity dropped 21.7%. First-time buyer searches showed a modest increase of 4.6%.
The data also highlighted a shift in preferences for fixed rate mortgage products. Two-year fixed mortgages accounted for 41.9% of all fixed product searches in December 2024, down from 49.7% a year earlier.
In contrast, three- to five-year fixed products rose to 35.5% of searches from 32% in December 2023. Longer-term (five to 10 years) fixed products gained popularity, now making up 22.6% of fixed product searches compared to 18.4% the previous year.
According to Nathan Reilly (pictured), director at Twenty7tec, the December slowdown was expected, given the seasonal trends and the Bank of England’s rate decision just before Christmas.
“We’ve seen much of the pent-up demand in prior Decembers come into the market in the subsequent January, so we’re hopeful that this period will once again be busy,” Reilly said, adding that December 19, the day of the rate decision, saw a record high of 24,264 mortgage products available on Twenty7tec’s system.
“There’s been talk in the market of the biggest ever Boxing Day bounce – when people begin to look at new properties, which will result in busier times for advisers over coming weeks.
“January is also likely to be busy – especially in the second half – with self-employed individuals looking for new mortgages as their tax bills are due January 31, and financial clarity means that more of them make decisions at this time of year about buying, remortgaging or moving home. 2024 was the busiest ever year on record for self-employed people looking for mortgages on our systems, 7.47% on the prior year.”
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