Case volumes drop in Q4 but mortgage market outlook remains ‘positive’ – IMLA

The average number of mortgage cases handled by advisers dropped from 90 in the third quarter of last year to 78 in the fourth quarter, new research from the Intermediary Mortgage Lenders Association (IMLA) has revealed.

However, IMLA suggested the vast majority of advisers still remain positive about the outlook for their businesses (96%), the intermediary sector (92%), and the wider mortgage market (85%).

IMLA said its latest findings, based on 301 interviews with mortgage intermediaries, closely mirror the results of its Q3 report and reflected positive attitudes across the sector in the second half of 2020. However, activity levels and case completion rates still remained lower than their pre-crisis levels.

While overall case volumes fell, the trade association suggested the business mix – the proportion of cases relating different mortgage types – remained broadly similar. The research showed that 66% of cases handled by advisers were for residential mortgages, 26% related to buy-to-let customers, while the final 8% were specialist.

The average number of Decisions in Principle (DIPs) processed by advisers in the last quarter was 25, a figure that also remained consistent with the findings in Q3.

IMLA executive director, Kate Davies, said that while the impending stamp duty deadline means activity will remain high in the weeks ahead, there are “clear signs that demand will continue beyond 31 March”.

“Intermediaries clearly remain positive about the outlook for the mortgage market,” Davies said.

“Advisers are also recognising that 2021 is set to be a major year for the remortgage market too, presenting plenty of opportunity.

“Although the rollout of the vaccine programme also gives us all more confidence that the end of the COVID-19 crisis may be in sight, many borrowers’ and prospective borrowers’ financial circumstances may have changed significantly over the past year, meaning that many of them will benefit from the expert advice which mortgage intermediaries can offer.

“However, as we approach the final months of the stamp duty holiday, there will be added pressure on lenders, conveyancers and all involved in the transaction process as consumers race to beat the deadline.

“IMLA and AMI have jointly warned that consumers need to be prepared to meet the additional costs if they cannot complete by 31 March.”

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