According to the published figures of various UK mortgage lenders, the number of products on the market has increased at last, bringing the number of mortgages available in Britain to 2,500 – which hasn’t occurred since May 2009. The increase is partly down to the Halifax’s decision to offer existing borrowers new rates. This has had a significant effect because the Halifax is one of the largest lenders in the UK.

Nevertheless, the increase does appear to be across the board, taking place over three successive months. It is, of course, great news for anybody looking for a first-time mortgage, although the 2,500 deals on the market still falls far short of the 30,000-plus that could be found in August 2007, before the impact of the credit crunch.

Although first-time borrowers can feel encouraged, the news is not so good for people considering remortgages. Lenders themselves are far more wary of dipping their toes into the remortgages market and it is widely believed that the market will remain limp until well into 2011. Analysts say that this reluctance is down to mortgage-providers’ focus on giving loans for the purchase of a first property, due to the Government’s insistence on this as a priority and its imposition of targets to be reached for a certain number of new mortgages.

Property owners themselves are also contributing to this phenomenon, as they hedge their bets while awaiting a change in the economy. With interest rates currently low, mortgage-holders are sitting tight and feeling the benefit. If these borrowers are near the end of their mortgage deals, their lenders’ reversion rates remain attractive, as they are linked to the base interest rate. If this rate goes up in the near future, only then are they likely to consider remortgages.

This state of affairs has been confirmed by the UK Council of Mortgage Lenders (CML), which has said that in January of this year, the number of remortgages that were approved dropped by 6 per cent in comparison with December 2009 – a total year-on-year fall of 39 per cent. The industry body said that the contemporary mortgage market is more akin to that of the early 1990s – also a time of recession – than the strong market at the beginning of this millennium.

Next year, the likelihood is that interest rates will rise and this will act as a spur to remortgages . There could be movement before then though, according to Spanish banking group Santander. The bank said that over 880,000 UK borrowers who are at present on fixed rate or tracker mortgages could be looking to remortgage by the autumn. The bank’s research found that they are not likely to want another tracker mortgage however, due to fears of a rise in interest rates.