Mortgage brokers are caught between wanting to offer better deals to clients and fears the market may be set for another fall, a building society’s head of distribution has claimed.
Speaking to FTAdviser, Newcastle Intermediaries’ recently appointed Steve Carruthers said many firms have clients on standard variable rates that could be improved, but often lack the resources to investigate their cases.
“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,” he said.
“Some firms have expanded recently, but others may suspect 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 said the biggest issue his members’ raise around expansion is recruitment - where to find another adviser or administrator to build their business.
He dismissed concerns about the mortgage market bubble bursting again, saying 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, while there’s also no let up on demand for remortgaging, which is mostly done via intermediaries, due to the complexity often involved.”
As for the strength of lenders, Mr Sinclair said moves made over the last few years to diversify their capital bases mean there are no major funding problems.
At the end of January, Natwest Intermediary Solutions’ broker survey found confidence about market prospects was at the highest since it began in July 2013.
These findings followed a Halifax mortgage adviser poll, which also found confidence was just below the all time high recorded in the first quarter of 2014, when the Mortgage Market Review came into force.
Daniel Bailey, a mortgage adviser with Derbyshire-based Middleton Finance, responded that all industries have their 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 there mortgage, this has been the case for the last few years and looks set to continue this year.”