The latest Mortgage Market Tracker report from the Intermediary Mortgage Lenders Association (IMLA) reveals that intermediary confidence in the outlook for the mortgage industry has now recovered to its long-run norm. 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 terms of confidence, in Q2 2024 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.
Such levels of intermediary confidence demonstrate a full recovery from the nadir following the Truss government’s Fiscal Event in September 2022.
The average number of mortgage cases placed by intermediaries on an annual basis increased to 96, compared to 92 in Q1 2024, reflecting 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 IFAs 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 around a quarter and specialist one in 10 cases. Q2 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—a level not seen for two years and comfortably surpassing the August 2023 peak of 30.
The average number of DIPs increased across all market sectors except for home movers. First-time buyer DIPs rose by an average of 11, remortgages were up by 10, buy to let increased by 9 and ‘other specialist’ DIPs were up by an average of 6 over the quarter. Home mover DIPs saw a slight decrease of -3.
Kate Davies, Executive Director of IMLA, comments:
“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 first-time buyers, 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. We will be watching with interest to see whether the next Mortgage Market Tracker reveals an even more positive outlook for our industry.”
For further information please contact:
Paula John, Paula John Communications
Tel: +44 (0)7973 435 299
Email: paula.john@imla.org.uk
Notes to Editors
The IMLA Mortgage Market Tracker uses data from BVA BDRC’s Project Mercury. Findings for Q2, 2024 are based on around 302 interviews with mortgage intermediaries, collected across April, May and June; as well as 100 interviews with mortgage intermediaries for the DIP business flow collected in June 2024.
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 53 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.