Remortgage valuations doubled (102%) from August 2014 and rose by 25% from July 2015, while at the other end of the spectrum buy-to-let valuations fell by 5% month-on-month after the government announced that it will be cracking down on mortgage tax relief by 2017.
As a whole valuation activity rose by 7% in August from July and 48% year-on-year.
Valuation figures are considered indicators for activity across the mortgage market.
John Bagshaw, corporate services director of Connells Survey & Valuation, said: “Concern and media attention about an interest rate rise in the near future is the key driver of this surge.
“Due to the very low Bank of England base rate, there are currently some very appealing remortgaging deals on offer from lenders. But homeowners have been influenced by a powerful perception that these deals will not last.
“Underneath the short-term surge, remortgaging is also driven by a longer term shift. People are increasingly looking to upgrade their home rather than trade – and so, for a slightly different purpose, are also keen to take advantage of cheaper mortgage deals.
“Meanwhile, the wider picture looks encouragingly stable. First-time buyers and home-owners are far more optimistic about the housing market now than they were at this point in 2014 – and this is evident from the strong, steady growth we’ve been seeing throughout 2015.”
Valuations for existing owner-occupiers have grown by 3% since July and 30% from last year, while first-time buyer activity rose by 1% month-on-month and 31% year-on-year.
Only buy-to-let valuations dropped month-on-month as they fell by 5% from July, while total valuations still rose by 29% year-on-year.
John Bagshaw added: “Buy-to-let has retained its winning popularity with investors. The slight slowdown the sector experienced this month is likely due to some investors taking a step back to calculate the cost of the Chancellor scrapping certain tax exemptions for buy-to-let landlords in the summer budget.
“However, the fundamentals of the rental market remain very strong, driven by tenant demand. Even buy-to-let – once a rollercoaster sector in terms of growth – is showing signs of settling into a positive pattern of strong and steady growth, a pattern replicated across many other sectors of the mortgage market.”
