Intermediary confidence returned to pre-pandemic levels in Q1 2021, according to IMLA

17 May 2021

  • Advisers’ confidence in the outlook for the mortgage industry recovered in Q1 2021 to levels not seen since before the start of the coronavirus crisis, according to IMLA’s latest Mortgage Market Tracker.
  • The conversion rate from offer to completion recovered dramatically from 65% in Q4 2020 to 75% in the first three months of 2021.

Intermediaries’ confidence in the outlook for the mortgage industry, the intermediary sector and their own businesses increased significantly in the first three months of 2021, according to the latest research from 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 £81.1 billion from £74.6 in Q4 2020.

Conversion rates

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 of the Intermediary Mortgage Lenders Association, comments

“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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Max Chason, Rostrum
Tel: 07557 156 891

Notes to Editors

The IMLA Mortgage Market Tracker uses data from BVA BDRC’s Project Mercury. Findings for Q1, 2021 are based on around 300 interviews with mortgage intermediaries, collected between January, February and March.

About IMLA

The Intermediary Mortgage Lenders Association (IMLA) is the trade association that represents mortgage lenders who lend to UK consumers and businesses via the broker channel. Its membership of 44 banks, building societies and specialist lenders include 18 of the 20 largest UK mortgage lenders (measured by gross lending) and account for about 90% of mortgage lending (91.6% of balances and 92.8% of gross lending).

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