Confidence in the mortgage industry among IFAs rose to record levels in the past quarter, according to research from specialist buy-to-let lender Paragon Mortgages.
The Financial Adviser Confidence Tracking (FACT) Index found confidence is now at 135.5, up from 121.7 in the first quarter.
This is the biggest ever quarterly rise in the index’s eight-year history, but can be accounted for by the rise in business levels, up 15% on the first quarter, 21% up on a year ago and 23% up on two years ago.
Other findings included a fall in the proportion of buy-to-let mortgages from 11% to 10%, with 42% of this first acquisitions. Over a third of buy-to-let activity was due to investors extending portfolios, 16% were remortgages and 6% was property substitution.
John Heron, managing director of Paragon Mortgages, said: ‘The proportion of buy-to-let mortgage activity is well balanced. At 10% of the overall mortgage market, it reflects the proportion of the private rental sector to the housing market as a whole.’
The index shows base rate trackers have increased market share from 26% to 30%, mainly at the expense of fixed rate mortgages, down from 26% to 23%.
Heron added: ‘This suggests borrowers believe the low interest rate economy is here to stay, but have already factored in the likelihood of rate rises of one or two points when they commit to a mortgage.’