Adviser business volumes reached record levels in Q2 2021, according to IMLA

10 August 2021

  • Adviser business volumes reached the highest ever recorded by IMLA’s Mortgage Market Tracker in Q2 2021, while adviser confidence in the outlook of the mortgage industry increased to levels not seen since 2018.
  • Six in ten intermediaries felt very confident about the outlook for their own firm in Q2 2021 compared to four in ten this time last year, according to IMLA’s latest Mortgage Market Tracker.

Average adviser business volumes reached new highs in Q2 2021, according to the latest findings from the Intermediary Mortgage Lenders Association (IMLA). Up from an annual average of 89 (Q1) to 95 (Q2) cases, advisers processed more applications than at any point since IMLA’s Mortgage Market Tracker began recording intermediary business activity.

Confidence and business volumes also continued to strengthen in Q2 2021. A staggering 98% of intermediaries reported feeling either ‘fairly’ or ‘very’ confident about the outlook for the mortgage industry, in Q2 2021. A further 97% of advisers also feel confident about the outlook for the intermediary sector.

However, intermediaries continued to feel most confident about the outlook for their own business last quarter, with 99% reporting feeling confident. Six in ten intermediaries also felt ‘very’ confident about the outlook for their own firm compared to just four in ten this time last year.

The latest data from the Bank of England also shows that gross lending on all mortgages increased to £87.8 billion between April and June, up from £81.1 billion in Q1 2021.

Conversion rates

Between April and June, advisers’ business mix (the proportion of cases relating to different mortgage types) remained stable. Approximately two thirds (67%) of cases handled by advisers were for residential mortgages, a further 26% related to buy-to-let customers, and 7% were specialist. However, the proportion of first-time buyer cases handled by advisers edged up from 20% to 23%, potentially reflecting the growing availability of low deposit mortgage products.

The average number of DIPs processed by intermediaries reached a two year high in Q2, increasing from 28 to 31. The conversion rate from DIP to completion was, however, stable quarter-on-quarter at around 43% in both Q1 and Q2. The conversion rate from offer to completion also reached its highest level since the start of the pandemic (77%). The conversion rate from application to completion also edged up to 67% in Q2 2021, compared to 64% in Q1 2021. Roughly two-thirds of applications resulted in a completion in Q2, a slight increase on the previous quarter.

Kate Davies, Executive Director of the Intermediary Mortgage Lenders Association, comments

“The positive findings of our latest report clearly reflect the strong recovery seen by the housing and mortgage markets in 2021. This buoyancy has driven activity and helped to provide confidence to consumers and the intermediary community. As a result, we have seen advisers’ confidence levels and average business volumes increasing to some of the highest recorded.

“Of course, we may see a softening in purchase activity in the second half of 2021 in line with slowing Government support, but advisers should feel spurred by the sizeable refinance market at play and a growing reliance on mortgage advice among those who have seen their financial circumstances complicated by the pandemic.”

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Notes to Editors

The IMLA Mortgage Market Tracker uses data from BVA BDRC’s Project Mercury. Findings for Q2, 2021 are based on around 300 interviews with mortgage intermediaries, collected between April, May, and June.

About IMLA

The Intermediary Mortgage Lenders Association (IMLA) is the trade association that represents mortgage lenders who lend to UK consumers and businesses via the broker channel. Its membership of 44 banks, building societies and specialist lenders include 18 of the 20 largest UK mortgage lenders (measured by gross lending) and account for about 90% of mortgage lending (91.6% of balances and 92.8% of gross lending).

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