Stephen Smith, director of mortgage club and housing for Legal & General (L&G) said that gross mortgage lending is expected to reach £240bn in 2016. He added that the market will be experiencing some of the best conditions in several years.
Mr. Smith spoke at the Mortgage Advice Bureau Trailblazers conference recently, saying that L&G’s forecast is positive beyond the £225bn it expects this year.
Four out of five respondents to a Mortgage Solutions poll agreed with L&G’s projections.
In terms of activity, Mr Smith said that 2015 is expected to reverse last year’s performance, with H2 being busier after a comparatively slower first half.
Market share for mortgage brokers can only move onward from 65% in the second half of 2014. Mr Smith believes it could rise to 70 or even 75% in the near future.
Referring to interest rates, he admitted that Bank of England governor Mark Carney’s statements always baffle him with what he called “their deliberate attempts to not lead the market.”
Mr Smith added that the resident economists at L&G anticipated the first rise in Q4 2015, while the consensus in the mortgage market predicted the first rise to make an appearance in 2016.
He concluded his presentation by advising the Mortgage Advice Bureau brokers present to expect more activity from gross lending as well as additional products and new lenders as a much more competitive market returns.
Back in December, banks and building societies reported that mortgage lending had slowed in November, with associated activity reaching approximately the same level as at the conclusion of 2013.
The Council of Mortgage Lenders (CML) stated that there was a 9% decrease on the £16.9bn seen in October 2013. Lending levels did increase in October, but they had been falling since July. Attempts on the part of the chancellor to reform the stamp duty system were expected to accelerate activity and house prices as 2014 progressed.