Moving into H2, confidence continued to build across the intermediary market as it prepared for an active remortgage phase, with a large share of the 1.8 million fixed rate mortgage deals maturing this year set to expire over the months ahead.
Looking back at conditions leading into Q3, the FCA’s Mortgage Lenders and Administrators Return (MLAR) highlighted a clear shift in borrowing behaviour. The share of gross mortgage advances for remortgages for owner occupation rose by 7.7% from Q1 to reach 29.0% in Q2, the highest level since early 2024. In contrast, lending for house purchase fell to 56%, its lowest share since 2024 Q1.
This data outlines a shift in the balance of lending activity across the market, with homeowners increasingly focused on long-term financial planning rather than short-term reaction.
July – A promising start
July signalled a slow but encouraging start to Q3. According to the Bank of England’s Money and Credit report, net mortgage approvals for house purchases rose by 800 to 65,400 in July. While approvals for remortgaging purposes with a different lender fell slightly by 2,700 to 38,900, the broader picture remained positive, with activity levels supported by improving affordability and borrower sentiment.
That view was echoed by Stonebridge who recorded a 9.2% year-on-year rise in mortgage applications across July 2025. The network attributed this uplift to easing borrowing costs and a more stable rate environment, which encouraged both new applications and refinancing activity. Interesting, the network added that remortgages accounted for 59.4% of all applications, compared to 50.7% in July 2024.
August – Momentum slows
However, August marked a temporary cooling in remortgage activity. LMS’s Monthly Remortgage Snapshot showed that new remortgage instructions fell by 8% month-on-month, while completions dropped 28%.
The preference for short-term security persisted, with two-year fixes accounting for 47% of new deals to reflect ongoing uncertainty around the Bank of England’s next move and borrowers’ desire for flexibility should rates fall further.
Regionally, London continued to dominate in loan values, with an average remortgage of £370,227, more than double the UK average of £176,365 outside the capital. Across the UK, the average stood at £218,922, with 45% of borrowers looking to increase their total loan size.
Despite this seasonal lull, the closing comment from the snapshot of ‘With households now back into a routine after summer, we expect activity to build as the year progresses, echoing the rebound we saw this time last year’ was telling, and certainly reflected in the closing weeks of the quarter.
September – Strong finish to the quarter
September data from Twenty7tec confirmed this forecast, with remortgages accounting for nearly half (48.95%) of all mortgage searches, up from 43.37% a year earlier. Total remortgage searches rose 14.59% year-on-year to 820,429, while purchase activity remained subdued.
Residential remortgage searches hit 610,022, up 15.22%, and buy-to-let remortgages climbed 12.81%, reinforcing the trend that landlords are actively reviewing their portfolios. Interest in longer-term fixes continued to wane, with 6–10-year products comprising just 12.32% of the market, the lowest ever recorded, further underlining the preference for shorter deals amid economic uncertainty.
Adding to the positive momentum, conveyancing distributor conveybuddy reported a 26% quarterly rise in remortgage instructions, maintaining a healthy 37% share of total cases. It suggested that the strength of the remortgage market continues to influence adviser recommendations, with brokers increasingly selecting all-inclusive remortgage conveyancing products.
Looking ahead
The remortgage market’s performance in Q3 has demonstrated real adaptability amid changing economic conditions. As borrowers look for stability and value, and lenders refine their propositions, the sector appears well-positioned for a steady and constructive close to 2025.
With product maturities peaking and lenders competing to capture market share in the closing months of the year, the advice process will continue to play a vital role in guiding homeowners to not only secure attractive rates but also make sustainable, well-informed financial decisions for the years ahead.
