Cath Hearnden, joint director of My Mortgage Direct, said: “The year started on a positive note and, as we predicted, has continued to show a steady increase in homeowners moving upwards and onwards instead of staying put and playing safe."
The incidence of home-movers is up by around 15 per cent on the previous quarter (Oct-Dec 2005), more than double on the same quarter last year, and My Mortgage Direct predicts that volumes will gather pace steadily over the coming months.
The continued stability of Bank of England base rates is the major driver of this upward trend.
Hearnden added: “Borrowers are being more considered and cautious than in recent years. They’ve waited and watched and now believe they won’t get any sudden nasty rate rise shocks.
“Last year saw a strong re-mortgage market and first-time buyers were also back in the frame, but this is not enough to sustain the market alone. We are pleased to see the major players back on stage."
Another feature of the past quarter is an upward tilt in buy-to-let applications, as buyers look to secure an investment property before prices rise too high to make it worthwhile.
And when it comes to arranging mortgages, trackers remain the most popular product, as buyers opt for the security offered by a stable Bank of England base rate. However, trackers are not necessarily always the best choice.
Hearnden concluded: “It’s probably fair to say that trackers can win the popularity contest simply due to a lack of imagination from borrowers. There are some excellent fixed rates available but the majority of borrowers are swayed by the immediate benefits offered by base rate stability and worry about missing out if rates go down further.There’s always a chance that rates will rise so often the best time to fix is at times like this. The prudent borrowers - 30 per cent - have spotted this and acted accordingly.”
