IMLA predicts gross lending of £150bn

Robyn Hall

January 25, 2013

Both predictions are slightly lower than the forecasts from the Council of Mortgage Lenders of £156bn gross lending and £12bn net lending but still point to lender optimism about growth.

Peter Williams, executive director of IMLA, said: “It is encouraging to see our members taking a positive yet pragmatic outlook for 2013. There is a general consensus that we will see positive growth in the UK housing market both in terms of mortgage lending and total residential transactions.”

The IMLA predictions follow a strong end to last year for the UK mortgage market, with £11.7bn of gross lending during December bringing the total estimate for 2012 to £143bn which included net lending of £9bn.

An estimated 930,000 residential property transactions were recorded in 2012 which was the first time this has exceeded 900,000 since 2008 and greatly exceeded the CML’s prediction of 825,000.

On average, IMLA members anticipated 940,000 residential transactions for 2013 though 40% felt the total will be higher and 20% predicted more than 1 million residential transactions over the next twelve months.

There is little expectation of significant movement in the average UK house price which stood at £161,490, claimed figures from the Land Registry.

IMLA members predicted the average price in June 2013 will be around £164,000.

In terms of market share, the survey revealed first-time buyers were expected to account for almost a quarter of total gross lending with over a third remortgaging and just under a fifth comprising of buy-to-lets.

Respondents to the survey said the greatest increase in high loan to value lending would occur in the 85-89% bracket; 58% expected to see up to a 10% increase in the number of 85-89% LTV loans while 21%expect to see growth of up to 15%.

More than half of members also expected to see up to 5% growth at the 90-94% LTV level however almost all members, 86% said there would be no more lending at 100% LTV during 2013.

David Finlay, chairman of IMLA, said: “There are a number of key challenges in the year ahead where IMLA will be active in representing our members’ interests and helping to guide the debate.

“With the MMR approaching in 2014 there is a real need for clear definitions on advising or arranging transactions and both lenders and brokers will be keen to know how pipeline business will be dealt with when the changeover arrives.”

Finlay added: “We are also committed to working with organisations such as the CML, the Association of Mortgage Intermediaries and the Building Societies Association to explore a solution to the issue of individual broker registration to help to uphold standards of quality and professionalism as well as limit the potential for fraud.

“This innovation can be a force for good in improving perceptions about operating standards in the market and also has the potential to drive an overall rise in performance and satisfaction for everyone concerned.”

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