This is our final issue of 2013, a year that will go down in the annals of the industry as the year the UK mortgage market finally got back on its feet.
The defining story of the year has been the Government’s Help to Buy scheme, abetted by the Funding for Lending Scheme. Cheap money for lenders and the giant helping hand of the Government have transformed the UK mortgage market. As this week’s lead story shows (page 4), this has not yet fed through to a greater percentage of lending at high LTV. But many in the industry are confident it will come in 2014.
It is worth reflecting on just how radically the market has changed over the past 16 months. Things were not looking good in 2012 before the introduction of the FLS. Even after its introduction, expectations for 2013 were conservative. This time last year the Council of Mortgage Lenders forecast that gross lending would hit £156bn in 2013 and fall back to £150bn in 2014. Instead, we look set to have lending of about £170bn this year, with the CML now forecasting £195bn for the year ahead and many in the industry privately anticipating much more.
This is no criticism of the CML. It simply illustrates how difficult it is to predict the future and the massive difference that confidence can make to the market. It really doesn’t take much for a market to turn.
So what can we expect in 2014? Here is Mortgage Strategy’s Christmas wishlist of things we would like to see next year:
- Lenders to better engage with brokers who have been kicked off panels, with a uniform appeals process.
- Fairer proc fees for brokers – the big one many have been asking for.
- Stamp duty reform – the Government must be brave and tackle this.
- 250,000 home starts – after 30-odd years of hurt we need to start repairing the damage done by a combination of Right to Buy and lack of investment.
Hopefully Santa will look kindly on us!
Have a merry Christmas and a happy new year – the next issue of Mortgage Strategy will be out on 8 January.