Broker confidence over business outlook rises, says Shawbrook

The survey, conducted by Shawbrook’s property finance division, found that 55% of commercial and 50% of residential brokers were confident about their business prospects for 2017. That is higher than July last year when only 38% of commercial brokers said they felt confident in the aftermath of the referendum on Europe.

The barometer also said that 72% of commercial and 59% of residential brokers were confident in the lending environment.

The economic climate was still a concern, cited by 24% of commercial brokers as their biggest challenge. However, this was outstripped by lending restrictions, which 28% said was their top concern. Similarly, 19% of residential brokers said lending restrictions are their biggest challenge, followed by the economy (17%).

Shawbrook said brokers were generally more confident about the UK economy post-referendum. Over a third (35%) of commercial brokers and 26% of residential brokers believed the result of the EU Referendum has had a negative impact on the lending environment, compared to July 2016 when 42% of commercial brokers predicted negative outcomes (residential brokers were not polled at that time).

Only 27% of commercial and 25% of residential brokers perceive the result as having a negative impact on clients.

Karen Bennett (pictured), managing director for commercial mortgages, said: “Over six months on from the referendum result, it appears that nervousness and negativity around the consequences of the vote have reduced, and brokers are feeling optimistic about what the year ahead may hold. Prospects for business growth are particularly strong and, despite awareness of the challenges ahead, broker sentiment remains positive.”

“It is revealing that, within the property finance division, commercial and residential brokers have varying levels of confidence in the lending environment for 2017, reinforcing that commercial and residential brokers face different key influences.”

Whilst both commercial and residential brokers agree that a fall in investor demand is the biggest consequence of the EU Referendum result (27% and 24% respectively), they differ on further significant consequences. More residential brokers saw a fall in prices as key than commercial brokers – 19% and 13% respectively.

Commercial brokers raised concerns over the government’s ban on letting agents’ fees, with 50% predicting that landlords will have to raise rents.

Maeve Ward, managing director of residential mortgages, said: “One of the concerns raised by residential mortgage brokers is around lead generation, which I believe is the result of a lack of customer awareness of products such as second charge mortgages.”

She added: “Brokers strongly agree (85%) that both lenders and brokers should be responsible for driving forward awareness and education – which will only result in better lead generation and increased confidence in the market.”