According to the latest report from mortgage industry tech supplier, IRESS, the buy to let sector continues to go from strength to strength, seeing a 49% increase in buy to let compared with it’s 2015 Survey.
The survey provides insight across many aspects of the mortgage market and application processing. Now in its fifth year, the 2016 survey analysed the responses of 18 lenders, with a combined share of gross mortgage lending of 68% in 2015, equating to £152bn of loans. Among the survey participants, the buy to let sector saw by far the largest year-on-year growth at 49%, while mortgages to first time buyers saw just a 0.7% increase and residential loans to home movers actually fell by 5.6%.
The intermediary channel continues to see the lion’s share of the mortgage market, with 82% of sales now going through this channel and almost three quarters (70%) of lenders experiencing an increase in the number of applications submitted by brokers over the last year. The direct channel continued to decline across branch and telephony, although sales via the internet increased, albeit from a low base. The internet channel remains a relatively small part of distribution, but as new digital entrants and so called “digital” brokers enter the market, this channel could double in the next 18 to 24 months.
A further key finding was that the number of accepts has declined in all sales channels: with accepts in branch dropping by 20%, in consumer by 18%, in telephony by 15% and by 9% in the intermediary channel. Banks have a significantly higher percentage of accepts than mutual s, likely to be due to banks investing in more sophisticated decisions and income verification, differences in risk appetite and application complexity.
The survey results show that the impact of the Mortgage Market Review (MMR) is still apparent, with average number of days to offer, a key measure of efficient customer service, significantly higher than pre MMR levels, although there has been a slight improvement over last year.
