There were 31% fewer remortgages completed in February, the latest LMS remortgage snapshot shows.

However, the conveyancing services firm found that remortgage instructions continued to increase last month with a 9% rise.

Homeowners who remortgaged last month saw their average monthly payment increase by £257.

The snapshot also shows that 70% of borrowers increased their loan size last month, leaving the average remortgage loan size in the UK standing at £193,733.

The average remortgage loan amount in London and the South East was £296,725 while the average for the rest of the UK stood at £148,546.

The longest previous mortgage length was found in Wales at 80.25 months (6.69 years) and the shortest was in London at 66.60 months (5.55 years), putting the longest previous mortgage term 17% longer than the shortest.

The most popular product in the market was a five-year fixed-rate loan used by just over half – 54% – of customers, with 30% saying the main aim of remortgaging was to “gain longer-term security”.

Nick Chadbourne, CEO at LMS, commented: “Instructions continued to rise in February as expected as people looked to lock in rates before they rise again – this is to be expected since we have seen swap rates bottom out, and the majority of borrowers continued to go after five-year fixed rates in a push for longer term security. Despite this, the pipeline contracted as a result of a simultaneous increase in cancellation rates – this was predictable, though, as people who secured rates in December started cancelling and reapplying for more attractive rates.

“Heading into March, we are likely to see an uplift in instructions thanks to the ERC spike expected at the end of the quarter. This will be tempered a little as affordability remains a challenge, and with the Spring Budget doing nothing to help the housing market this will be unlikely to go away anytime soon.

“What we needed was measures to help people get on the property ladder, with the government taking steps to increase housing stock and therefore improve affordability, and to make the long-term rental market more stable by easing punitive measures on landlords, but we didn’t see any of that.

“Hopefully there will be more input in the coming months, but until then we are likely seeing reduced activity overall as people effectively wait and see before making any decisions.”