When putting together a comment piece for Mortgage Solutions this time last year my conclusion was that 2012 had been a steady year with far more positives than negatives.
Now let’s just say that Mystic Meg’s day job is safe for now as these were hardly inspired predictions but thankfully the industry has certainly performed as hoped, and then some.
Much of this has inevitably been down to the momentum generated from the government’s Funding for Lending Scheme although the end is now imminent.
It was no secret that the scheme was never intended as a long term solution and lenders knew this type of aid and support had to come to an end so were well prepared for such an announcement.
The full impact of this revelation remains to be seen with speculation naturally arising over potential headline rate increases in the offing and mortgage deals in general on the up. Whatever the market has in store for 2014 let us not forget that FLS has performed admirably and achieved what it set out to do by leaving the mortgage market in a far stronger, more robust and durable place to cope with this transition.
The fact that such an announcement has not dulled expectation in terms of future lending and business levels speaks volumes about how far the overall market has come in 2013.
Of course when looking back on 2013 it would also be remiss not to cite the effect of Help to Buy and indeed the consumer perception of the market. The influence of Help to Buy 2 is still up for debate but if nothing else it does seem to have had some effect accelerating some borrowers access to higher LTV deals, especially at 95%.
Looking back to the start of 2013 I can’t help but wonder what kind of response we might have had from some respected industry commentators to a government pledge to help more borrowers access 95% LTV mortgages and debates over a housing bubble only a matter of months away?
But let’s be clear in our expectations for 2014. We want and need the industry to progress at an organic rate. Over inflating market conditions will not do borrowers or lenders alike any good over the long term and it’s clear that, whilst not suppressing competition or innovation, the mortgage market must progress at a sensible pace for all concerned.
That way we can all look forward to a buoyant 2014.
David Finlay is intermediary managing director for Barclays
