The latest report from the Intermediary Mortgage Lenders Association (IMLA) indicates a slight decline in business confidence post-general election.
- Advisers’ optimism in their sector dipped initially, with a rebound evident by September.
- Brokers’ confidence in their businesses saw a downward adjustment, reflecting broader market changes.
- Overall, intermediary confidence remains strong, despite marginal declines in certain areas.
- Changing business volumes and mortgage case placements highlight the market’s ongoing adjustments.
In the wake of the recent general election, the IMLA’s latest report captures a modest shift in the confidence levels among mortgage intermediaries. Initially, there was a noticeable dip in advisers’ optimism. The proportion of those feeling ‘very positive’ about their sector plunged from 42% in July to 33% in August but rebounded to 44% in September. This fluctuation mirrors the market’s responsiveness to political changes.
The confidence of brokers in their own operations experienced a minor decline. Following a significant rise in Q2, the percentage of those ‘very confident’ fell from 54% to 44% in Q3. Meanwhile, those expressing ‘fairly confident’ sentiments increased from 43% to 51%. Despite these shifts, the historical context shows that broker confidence remains robust.
Business volumes have subtly decreased, with the average number of mortgage cases processed falling slightly. Intermediaries, including both mortgage brokers and IFAs, experienced a slight reduction, from an annual average of 96 in Q2 to 92. Notably, mortgage brokers processed an average of 96 cases, experiencing a decrease of six compared to the previous quarter, while IFA numbers stabilized at 68.
The market dynamics also revealed a slight variation in business distribution across sectors. The proportion of buy-to-let cases dropped from about a quarter in Q2 to 22% in Q3 2024. Conversely, residential lending accounted for 68%, with specialist business levels steady at 10%. This data reflects subtle rebalancing within the market.
Decisions in Principle (DIPs) processed by intermediaries returned to typical levels, averaging 27 in Q3, down from an exceptional 33 in Q2. This return to standard figures is indicative of the market’s gradual stabilization. The conversion rate from DIPs to completions held steady at 39%, following a drop in the previous quarter.
Kate Davies, IMLA’s executive director, comments on these findings, suggesting that the post-election market exemplifies a recovering trajectory from past fiscal challenges. She notes the market’s resilience, highlighting the minimal impact on buy-to-let volumes despite fears around prospective governmental policies. Davies points towards continued economic uncertainty and how it will be interesting to see the impact of upcoming events such as the Budget and US Election on Q4 outcomes.
While intermediary confidence has seen minor shifts, the market continues to demonstrate resilience.
