Brokers predict increased mortgage business (From Watford Observer)

Brokers predict increased mortgage business

10:50am Monday 6th July 2009 in

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Confidence continues to return to the mortgage intermediary market with brokers expecting a significant upturn in mortgage business in the third quarter of 2009, research from Paragon Mortgages has revealed.

Paragon’s Financial Advisor Confidence Tracking Index, a quarterly survey of financial advisors, found that brokers expect to do eight per cent more mortgage business in the three months to the end of September than in the second quarter. This is the second quarter in a row that brokers have predicted an increase in mortgage business and follows a negative 2008 when the intermediary market, on average, predicted contracting levels of business.

Overall, 58 per cent of respondents predicted an increase in mortgage business, with nearly a third (31%) expecting to see a 10 per cent or more uplift in business.

Only seven per cent of brokers expect business to fall, which compares favourably to the March 2009 and December 2008 surveys, when 19 per cent and 39 per cent of brokers respectively stated that they expected business levels to decline in the following three months.

The increased level of confidence is reflected in staffing levels at brokers, which rose by an average of three per cent% over the second quarter. According to the survey, 18 per cent of brokers said they had increased staffing levels, with nine per cent stating that staff numbers had increased by 25 per cent or more. Over the same period, five per cent of brokers said that they had cut staff numbers.

Paragon Mortgages managing director John Heron said: “We are starting to see concrete signs of confidence returning to the mortgage market and that can only be a positive for the UK housing market. Mortgage brokers have endured some tough times in the past 18 months so it is welcoming that the market if finally seeing some positive news.

”However, the mortgage market cannot fully recover unless more is done by Government to increase the availability of mortgage finance to consumers. Lending is still at very low levels as lenders seek to retain capital and normal funding avenues remain closed.

"Mortgage availability is still relatively scarce and only those with high deposits can secure the most attractive rates. The Government has made some progress through its various lending stimulus packages, but it is clear that more needs to be done.”