Intermediary confidence in the outlook for the mortgage industry has now recovered to its long-run norm, the Intermediary Mortgage Lenders Association (Imla) reveals.
The latest figures show that business volumes continue to grow, with mortgage brokers processing an average of 102 cases in the year to June, an annual figure last reached in 2021.
In the second quarter of this year, 29% of advisers described themselves as ‘very confident’ and 65% ‘fairly confident’ about the future, compared with 24% and 62% in the previous quarter.
The proportion of advisers describing themselves as ‘very confident’ or ‘fairly confident’ in the intermediary sector itself rose to 94%, up from 88% in the previous quarter.
Intermediary confidence in the outlook for their own businesses improved even more markedly, with 54% saying they were ‘very confident’ and 43% ‘fairly confident’.
The share of advisers who said they were ‘not very’ or ‘not at all’ confident remained marginal, having fallen away to almost nothing in Q1, a result not previously recorded since Q2 2021.
Imla says that this level of intermediary confidence demonstrates a full recovery following the Liz Truss government’s fiscal event in September 2022.
Elsewhere, the average number of mortgage cases placed by intermediaries on an annual basis increased to 96, compared to 92 in Q1 2024.
This reflects the Bank of England figures which report a market still subdued, yet seeing some lift in Q2.
Mortgage brokers placed an average of 102 cases, while independent financial advisers reported an average of 67.
Business split across the sectors was very similar to Q1 2024, with residential lending continuing to account for around two-thirds of intermediaries’ business, buy-to-let (BTL) around a quarter and specialist one in 10 cases.
The second quarter saw a slight decrease in the proportion of product transfers and a small rise in ‘other’ specialist cases.
The average number of decisions in principle (DIPs) that intermediaries processed grew strongly, up 10 during Q2 at 33.
Imla says this level has not been seen for two years and comfortably surpasses the August 2023 peak of 30.
The average number of DIPs increased across all market sectors except for home movers.
First-time buyer (FTBs) DIPs rose by an average of 11, remortgages were up by 10, buy to let increased by nine and ‘other specialist’ DIPs were up by an average of six over the quarter. Home mover DIPs saw a slight decrease of three.
Imla executive director Kate Davies says: “These results reflect not just increased activity in the mortgage market but greater positivity about the future than we have seen for some time.”
“It is encouraging to see that business volumes have been sustained across all sectors. Despite predictions of a mass exodus of landlords from the buy-to-let market, and concern that affordability challenges would deter all but a few of the wealthiest FTBs, there has been no discernible reduction in overall cases in either sector. Intermediaries have been working harder than ever to find the most suitable solutions for their customers across the sectors, which has no doubt played an important part in maintaining these numbers.”
“These results reflect the period before the change of government and before the Bank of England made its first interest rate cut since March 2020.”
