According to a poll conducted by Mortgage Solutions, 29% of respondents are currently fairly confident about the outlook for 2016, while 25% are not optimistic at all. A further 10% believe it is too early to predict how the industry will fare next year.
Brokers say that a rise in the bank base rate will prompt a surge in remortgaging activity, softening the blow of a 3% hike in Stamp Duty for buy-to-let investors, which is expected to cause activity in the sector to dip.
Stuart Gregory, managing director at Lentune Mortgage Consultancy, said the firm is beginning to a see a change in sentiment among clients.
“More clients are taking a little bit more ownership of the situation and I think its generally the clients who keep their finger on the pulse of what’s going on around them anyway. Mark Carney’s [Bank of England governor] yo-yoing of forward guidance is giving more people a false sense of security but on the other side of the coin a lot of people are seeing through it,” he said.
“As a result, the individuals that realise how fixed-rate pricing works also realise that they’ve got to take action when they can, rather than waiting to be told.”
Gregory raised concerns that many potential remortgagors do not realise the degree of change the mortgage market has seen since 2008.
“The only fear I’ve got is the shock a lot of people will have when they start the remortgaging process, because there are a lot of people who haven’t reviewed their mortgage since 2008,” he added.
“The change in the market since then has been huge and we now have to provide explanations to clients about why we require so much in depth information about their outgoings. People are having to get their head around the fact that they are now required to divulge far more information than they would have done in the past.”
Mark Dyason, director at Edinburgh Mortgage Advice, added: “The Bank of England might finally carry out its threat and raise the base rate next year. This should help to boost the remortgage market and fill the gap created by the buy-to-let market because of the punishment that the Chancellor has heaped on it.
“Consumers will likely believe that the Bank of England has been crying wolf for the last few years about raising interest rates, but the fact of the matter is where America leads, the UK will generally follow. I’d expect that people will start to pay attention and think about remortgaging once the US moves to raise interest rates.”