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Conditions are perfect for brokers, says Laker

Sally Laker

While some people thrive on uncertainty, others like to embrace the security they get from staying where they are

The past year has shown that anything can happen. When it comes to world affairs, change is on the agenda in a number of guises.

While some people thrive on that, the uncertainty forces others to embrace the security they get from staying where they are.

Take potential homemovers: many now deem the risk of moving up the property ladder and taking on more expense to be too high, particularly if job uncertainty is also a concern. This means fewer properties are going up for sale.

In addition, the many changes affecting the buy-to-let and second-home property market have made potential purchasers in these areas much more cautious. A previously straightforward decision has been muddied thanks to increasing costs and complexity, with some deciding the money that would be spent on such a purchase is better used to improve their existing home.

This dilemma affects not only consumer movement but lenders as well. Keen to maintain their lending levels, they will be looking at specialist sectors and attracting remortgage business.

We have seen the percentage of remortgage business grow month-on-month, which is not surprising as two-, five- and 10-year deals are still very attractive in this low interest-rate environment. The fact that most lenders’ standard variable rates are more expensive than the new deals available makes a further case for it.

Lenders have already recognised the importance of intermediaries in this respect with recent changes to retention fees. Indeed, both the climate and the timing are perfect for brokers, and we should be making sure customers do not pay any more than they need to.

For lenders, meanwhile, the environment provides a perfect opportunity to kickstart remortgage campaigns.

Sally Laker is managing director of Mortgage Intelligence

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