Consumers ‘looking to remortgage homes’

An increasing number of homeowners are remortgaging their properties, new figures indicate.

Research conducted by Moneyextra reveals the average remortgage was some £122,541 in May - a rise of 7.19 per cent from the same month in 2006.

The popularity of remortgaging was attributed to a rising number of consumers looking to make use of equity to pay off via Homeowner Loans and other forms of borrowing.

Senior editor Robin Amlot said: "Recent reports from the retail sector, including disappointing sales growth figures from both Tesco and Sainsbury, would suggest that we’re not spending this money on goods and services but using it to reduce other debts."

He also claimed that such as a move can help homeowners avoid "expensive credit card debt and overdrafts".

The study also indicated that property prices have risen by 6.05 per cent over the past 12 months with the average house price now costing £228,754 - a figure which could increase secured loan costs for potential first-time buyers.

Earlier this month, Howard Archer, Global Insight UK and European chief economist, claimed that property buyers find getting on the housing market "increasingly difficult".

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