The Mortgage Market Tracker report from the Intermediary Mortgage Lenders Association (IMLA) showed that mortgage brokers were processing an average of 102 cases in the year to June, the highest level of business since 2021.

This coincided with 29% of advisers saying they were ‘very confident’ about the future in Q2, and 65% reporting themselves as ‘fairly confident’. This was higher than sentiments of 24% and 62% in Q1. 

There was optimism towards the market as a whole, as the share of mortgage advisers describing themselves as either ‘very confident’ or ‘fairly confident’ in the intermediary sector rose from 88% in Q1 to 94% in Q2. 

There was a more noticeable improvement in the confidence levels mortgage advisers had for their own business, with 54% saying they were ‘very confident’ and 43% ‘fairly confident’.

The share of advisers who were ‘not very’ or ‘not at all’ confident about their business was small and fell away “to almost nothing”, IMLA said. The organisation said this had not been seen since Q2 2021 and the current levels of confidence indicated a full recovery after suffering in the wake of the 2022 mini Budget. 

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Business conducted by mortgage intermediaries 

The average number of mortgage cases placed by intermediaries rose from 92 to 96 quarter-on-quarter, which aligned with Bank of England data, which showed a rebound in activity. 

Similar to Q1, residential lending accounted for around two-thirds of business in Q2, while buy to let (BTL) made up roughly a quarter and specialist cases made up a tenth of activity. 

IMLA found there was a slight fall in the share of product transfers conducted in Q2, while ‘other’ specialist cases rose marginally. 

The average number of decisions in principle (DIPs) processed by mortgage intermediaries rose to 33 in Q2, up by 10 compared to Q1. IMLA said this level of business had not been seen for two years and was “comfortably surpassing” the August 2023 peak of 30 DIPs processed per adviser. 

The average number of DIPs processed rose across all markets except for homemovers. 

First-time buyer DIPs increased by an average of 11, remortgages by 10 and BTL went up by an average of nine. DIPs for ‘other specialist’ mortgage cases rose by six since the last quarter, and homemover DIPs fell by three. 

 

Greater positivity in the market 

Kate Davies (pictured), executive director of IMLA, said: “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.”