Demand in the mortgage market has dipped slightly in Q3 2022, most likely as a result of the current turbulent economic climate, with the latest data from IMLA’s Mortgage Market Tracker showing that average intermediary case volumes decreased slightly from 97 in Q2 to 93 in Q3.
Despite this, and likely in part due to house price increases, the Bank of England reported nearly £85 billion in gross lending on all mortgages in Q3, the highest number seen since Q2 2021, when it was aided by the Stamp Duty holiday.
Intermediary confidence in the business outlook for their own firms remained stable, with 51% stating that they were ‘very confident’, down very slightly from 52% in Q2. There was a similar pattern for confidence in the outlook for the intermediary sector, with 91% of intermediaries confident overall, down from 93% in Q2.
However, confidence amongst intermediaries in the outlook for the mortgage industry fell noticeably, with the IMLA research revealing that only 81% of intermediaries were confident overall in Q3, falling from 89% in Q2.
The average number of Decisions in Principle (DIPs) that intermediaries processed remained stable in Q3 2022, decreasing very slightly to 27, from 28 in Q2. Despite this, levels picked up in September (28 per intermediary), compared favourably to the beginning of the quarter in July (26 per intermediary).
In Q3, conversion rates from DIP to completion fell for the fourth successive quarter to 38%, from 44% in Q2—10% lower than Q3 2021.
Kate Davies, Executive Director, IMLA commented:
“It’s good to see that intermediaries are very confident in the business outlook of their own firms—it’s clear from our data this quarter that advisers are still very busy, with many saying that their overall workloads have increased. This is hardly surprising—the cumulative effects of the cost-of-living crisis, high inflation and higher interest and mortgage rates are creating increasingly complex circumstances for borrowers. This in turn makes the role of professional mortgage advisers more important than ever.”
For further information please contact:
Notes to Editors
The IMLA Mortgage Market Tracker uses data from BVA BDRC’s Project Mercury. Findings for Q3, 2022 are based on around 300 interviews with mortgage intermediaries, collected between July, August, and September.
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 52 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).