We have a much wider base of people today who, regardless of rate cuts and market sentiment, simply cannot remortgage
Falls of 40 per cent are not to be taken lightly in any sector. So when the latest Bank of England credit conditions survey outlined this level of quarterly decline in demand for mortgages, I suspect you, like me, were rather concerned about what it would mean for your business.
No one is suggesting this means an immediate 40 per cent drop in the level of business you are writing. However, it means that, from a purchase angle at least, there has been a considerable shift in recent months.
For advisers, the big question is whether the resurgence in remortgaging is enough to make up for that purchase inactivity.
But while it is nice to see the remortgaging sector drag itself out of the doldrums, we are in a rather different place from where we were the last time sentiment appeared to be strengthening.
I refer you to our post-MMR environment, with tighter affordability criteria, the growth of ‘no go’ areas for some lenders in terms of meeting borrower demand, and the plight of the mortgage prisoner. We have a much wider base of people today who, regardless of rate reductions and market sentiment, are simply unable to remortgage even if they would like to.
The lending figures for the summer do not lie: activity is down and, even with a seasonal push, we will probably not get close to where we would like to be.
Given this environment, how important are those clients who are in a position to act? How important is it that you ensure their product needs are taken care of? Do you really want them to go elsewhere? You may never see them again.
Make sure you cover all their needs, including conveyancing, protection and insurance. It is the service you should be providing anyway but, in a market with less than ideal activity levels, it could be your saving grace.
Harpal Singh is managing director of Broker Conveyancing