IMLA: Intermediary confidence returns to pre-pandemic levels

Jake Carter

May 17, 2021

Intermediaries’ confidence in the outlook for the mortgage industry, the intermediary sector and their own businesses increased in Q1 2021, according to the Intermediary Mortgage Lenders Association (IMLA).

The trade association’s latest report also recorded a 14% increase in the average annual number of cases handled by intermediaries between Q4 2020 (78) and Q1 2021 (89).

Confidence in the mortgage industry has returned to levels not seen since before the start of the pandemic, with 96% of intermediaries now confident about its future.

A further 97% reported being confident about the intermediary sector and 99% saw a positive outlook for their own business.

The latest data from the Bank of England also shows that gross lending on all mortgages increased to £81.1bn from £74.6bn in Q4 2020.

This quarter, the business mix (the proportion of cases relating to different mortgage types) remained stable.

Two thirds (66%) of cases handled by advisers were for residential mortgages, a further 28% related to buy-to-let customers, and 6% were specialist.

However, the average number of DIPs processed by advisers increased from 25 to 28 between the final three months of 2020 and Q1 2021.

The conversion rate from DIP to completion also increased quarter-on-quarter with 43% in Q1 21 compared to 34% in Q4 20.

After a significant drop in the wake of the coronavirus crisis, the conversion rate from offer to completion increased dramatically from 65% in Q4 2020 to 75% in Q1 2021.

The latest results show that almost two thirds of all applications resulted in a completion between January and March 2021.

In Q1 2021, the rate reached 64%, compared to 68% in Q1 2020.

Kate Davies, executive director at IMLA, said: “Following a difficult period in the wake of the coronavirus crisis which led to the temporary closure of the housing market, it is pleasing to see such a positive start to 2021.

“Our findings show that after a steady period of recovery, adviser activity levels and sentiment towards the outlook for the sector are now nearing levels not seen since before the start of the pandemic.

“We also expect this high demand to continue into the year, with a combination of Government support helping to underpin new purchases and a bumper year for product maturities also providing significant opportunity in the refinance market.”

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