Adviser confidence surges as business levels rebound
The latest Mortgage Market Tracker report from the Intermediary Mortgage Lenders Association (IMLA) shows intermediary confidence in their own business, the outlook for intermediary channel and the mortgage industry rebounding to near record highs.
In Q1 2025, 98% of intermediaries said they felt ‘very confident’ (46%) or ‘fairly confident’ (52%) about the prospects for their own business; 94% felt ‘very confident’ (44%) or ‘fairly confident’ (49%) about the outlook for the intermediary sector, and 92% were confident about the mortgage market in general, although brokers were more guarded on the latter, with only 29% saying they were ‘very confident’ and 63% ‘fairly confident’.
Q1 saw a sharp recovery in average business levels from 80 cases per year in Q4 2024 to 95 cases, a return to the long-term trend. This suggests the reported fall in case volumes in Q4 2024 (a fall of 12 compared to Q3) was a blip, rather than a real shift. Bank of England data shows the overall secured lending market growing further, almost reaching the level attained in 2022.
In volume terms, there was little change in business mix, with residential lending making up two-thirds of intermediaries’ business, buy to let just under a quarter and specialist lending about one case in nine. Remortgaging and Product Transfer accounted for 27% of residential business handled, with first-time buyers making up 21%.
The average number of DIPs dealt with increased by 5 points this quarter to 33. The proportion of DIPs resulting in a DIP accept grew from 80 in Q2 2024 to 84 in Q1 2025, while that of DIP accepts resulting in a full application also increased slightly to 74%. The proportion of full applications resulting in an offer saw a small increase (+4), to 89%, the highest in three years. Conversion from offer to completion remained stable at 76%.
Kate Davies, executive director of IMLA, said: “These results suggest that, despite global economic and political uncertainty, the continued resilience of the UK housing market and the falling interest rate environment have combined to boost morale among mortgage intermediaries.
“The end of the Stamp Duty concessions on 1 April will have contributed somewhat to the uplift in average case numbers. However, the fact that first-time buyer businesses accounted for a smaller proportion of residential activity than remortgages and PTs demonstrates a more general recovery of business levels.
“With affordability continuing to improve as rates come down and the regulator encouraging more lender flexibility, brokers seem confident that these higher levels of activity may continue later into the year.
“The buy-to-let sector continues to thrive, still accounting for almost a quarter of mortgage business, despite the extra Stamp Duty imposed on purchases in October’s Budget and continuing concerns over the impact of the Renters’ Rights Bill.
“The fact that the proportion of cases successfully progressing from every stage from Decision in Principle to completion increased in Q1 is also good news.
“Inflation in the UK remains sticky, and the future path of interest rates is not guaranteed, but this month’s Base Rate cut and the recent competition and innovation among mortgage lenders are contributing to a more benign market than we have experienced for some time. It will be interesting to see whether the Mortgage Market Tracker results for Q2 remain as positive as the first three months of 2025 – let’s hope so.”