Mortgage Brokers to Play an Important Role in Market Recovery

Wednesday, January 25th, 2023

A recent report from the Intermediary Mortgage Lenders Association (IMLA) shows that the mortgage market has remained resilient throughout 2022 despite the numerous challenges from different economic and political angles.

Total Mortgage Lending Increased in 2022

Total mortgage lending was expected to reach over three hundred and ten billion pounds in 2022, which represents a slight increase compared to 2021. This figure has been driven by comparatively high levels of remortgage activity, which accounts for around thirty-five percent of the total. The buy-to-let mortgage market has also had a record year, with an estimated gross lending figure in 2022 of around fifty-six billion pounds. **

More People Are Using a Mortgage Broker

IMLA also reported that business conducted through a mortgage broker increased from eighty to around eighty-four percent during 2022 and it expects this share of the mortgage market to grow to nearer ninety percent by 2024. The report indicates that mortgage brokers and intermediaries will continue to play an important role in the property and mortgage sector as borrowers seek to find the best and most suitable mortgage when they try to move or remortgage at a time when interest rates are higher than they have been for many years.

Overall Mortgage Lending Is Set to Fall in 2023

Further predictions made in the IMLA report suggest that a higher interest rate environment is likely to result in overall mortgage lending falling to around two hundred and sixty-five billion pounds in 2023 and furthermore to around two hundred and fifty billion pounds in 2024. Buy-to-let mortgage lending is also predicted to fall to around forty-seven billion pounds in 2023 as inflation and a tougher economy combine to impact the market.

The Impact of Covid-19 and the Cost-of-Living Crisis 

After a period of Covid-19 driven economic turmoil, it was to be hoped that 2022 would be a year of recovery leading to a return of some sort of normality and stability. However many factors have in reality impacted mortgage rates, including depleted supply chains, the sharp rises in energy prices triggered by Russia’s invasion of Ukraine, and ongoing political uncertainty in the UK.

The report does however go on to suggest that despite all these factors, many of which have contributed to the current ‘cost of living crisis’, repossession figures in the coming months and years are expected to be less than half of those in 2009. This expectation is driven by the fact that more people have taken out capital repayment (as opposed to interest-only) mortgages, prolonged periods of house price inflation, and greater forbearance by mortgage lenders. That said, there are likely to be ongoing challenges for the UK mortgage market and furthermore the wider economy. 

Get Specialist Advice from an Expert Mortgage Broker

Mortgage brokers like ourselves are on hand to provide valuable advice and help navigate what can often be a tricky and daunting mortgage journey for many prospective borrowers. To check out what our clients think of the first-class service they have received, click our testimonials link  HERE.

Thereafter, if you would to know more about which options may work best for you, just call one of our friendly mortgage broking experts here at Caboodle Financial Services of Sutton Coldfield, Birmingham on 0121 308 9114, or alternatively, click HERE to contact us via our website and one of our friendly team will be in touch.

We very much look forward to speaking with you.

_{**Source – Financial reporter 21-12-2022}

The information contained above was correct at the time of publication but is subject to change.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR ANY OTHER DEBT SECURED ON IT. THE FINANCIAL CONDUCT AUTHORITY DOES NOT REGULATE SOME TYPES OF BUY TO LET AND INVESTMENT MORTGAGES.