Mortgage brokers are caught between wanting to offer better deals to clients, and being worried the market may be set for another fall, a building society’s head of distribution has claimed.
Speaking to FTAdviser, Steve Carruthers, the recently appointed head of mortgage distribution at Newcastle Intermediaries, suggested that many firms will have a lot of clients on standard variable rates that could be improved, but often do not have the resources to help.
“It’s something of a dilemma for brokers, many of whom re-trenched post-crisis and are now wondering whether they should recruit to meet demand.
“Some firms have expanded recently, but others may suspect that the current boom is cyclical in nature and we’re at the high point before a fall.”
The Association of Mortgage Intermediaries’ chief executive, Robert Sinclair, stated the biggest concern he’s heard from members around expansion is simply where to find another adviser or administrator to build their business.
In terms of concerns around the mortgage market bubble bursting again, Mr Sinclair countered that since 2008, there has been a return to sustainability.
“The government is pushing hard on new build, so we’ll be seeing many more properties coming onto the market in the next few years. There’s also no let up on demand for remortgaging, which is mostly done via intermediaries, due to the complexity that is often involved.”
As for the strength of lenders, he argued that moves made over the last few years to diversify their capital bases mean that there are no major funding problems to worry about.
At the end of January, Natwest Intermediary Solutions’ latest broker survey found confidence about market prospects was at the highest since it began in July 2013.
These findings followed Halifax’s most recent mortgage adviser poll, which also found that confidence was just below the all time high recorded in the first quarter of 2014, when the Mortgage Market Review came into force.
Adviser view
Daniel Bailey, a mortgage adviser with Derbyshire-based Middleton Finance, responded that all industries have highs and lows, and the intermediary mortgage market is in a healthy position at the moment. Most mortgage brokers I know are hiring, or have been hiring, more administration staff and advisers to cope with the demand.
“Consumers are increasingly using brokers to arrange their mortgage. This has been the case for the last few years, and it looks set to continue this year.”
peter.walker@ft.com
