Broker business could rise in the second half of this year, following the traditional bout of World Cup fever
The general election is finally out of the way and we are faced with a bright new blue and yellow dawn, the like of which most of us have never seen.
But what does this mean for leads and consumer demand for brokers’ services? Are individuals likely to be clamouring for advice now, or will the post-election excitement die away into a static period?
Although this is a bit of a crystal ball exercise, here’s what I believe will happen. speculation around the election has distracted everyone for the past month. Many individuals have been sitting on their hands until they saw which party got into power and what that might mean for their jobs and mortgage rates.
I don’t expect this to change immediately. If anything, the coalition government could mean a post-election pause that leads borrowers to delay their search for advice until they know exactly what spending cuts the new administration will implement.
This will take us through to the second media barrage of 2010 – that surrounding the World Cup, which has previously been a time of low lead volumes.
In the last World Cup in 2006, during the first England game and again when England dropped out of the competition, lead volumes plummeted to lows normally only seen on Christmas Day as the public switched off their computers and turned to their television screens instead.
But the good news is that consumer demand for advice does not go away and a decline at one point usually leads to a surge a bit later.
If this year follows that pattern expect pent-up demand to be released in the second half of 2010, with a substantial increase in the number of consumers looking for advice.
Of course, one sector of the population is already increasingly looking for advice – potential first-time buyers.
While many brokers are predominantly interested in those looking for remortgage advice because of the lead time from contact to completion, many first-timers see low interest rates as a great opportunity time to buy.
On the other hand, the number of remortgage borrowers looking for advice at the moment is relatively low. But if the base rate changes there will be another flurry of enquiries for brokers.
Of course, one sector of the population is already increasingly looking for advice – first-time buyers
Only a few commentators expect a base rate change before the end of the year but as speculation grows – and especially if lenders start raising their SVRs – more consumers will be seeking advice to find deals before the cost of their mortgage rises too much.
While there are a few consumers looking for buy-to-let advice, if the government goes ahead with plans to increase Capital Gains Tax there could be a flood of properties on the market soon.
Again, this is likely to boost the number of individuals looking to move home, especially if houses come onto the market in such numbers that it depresses prices in some areas.
Finally, if the Conservatives have their way the total amount of lending could rise steadily. As mortgages become easier to place conversion rates on leads will also increase. This has to be good news for everyone.