Gross mortgages for 2021 could be even higher than the £ 283 billion forecast by the Intermediary Mortgage Lenders Association (IMLA) after the Chancellor revealed new stimulus for the housing market in his budget, he said. declared a member of the professional body.

Speaking to Accord Mortgages chief executive Jeremy Duncombe on the lender’s podcast, IMLA senior researcher Rob Thomas said government budget announcements and higher than expected housing demand meant that loans could reach higher levels than expected.

He said: “If I predicted now it would probably be higher than this number. [of £283bn] in fact.

“I think the market is likely to be a bit more bullish.”

UK Mortgage CFO Charles Roe, who also appeared on the podcast, said if he reflected UK Finance’s £ 215bn figure he would also revise gross mortgages upwards.

According to figures from the Financial Conduct Authority, new mortgages for 2020 stood at £ 249bn, down 10% from £ 276bn in 2019.

Roe said a combination of positive market indicators, including the successful deployment of the Covid vaccine, had convinced him that overall loans in 2021 would be higher than initially expected.

He added, “I think we can expect increased demand from borrowers looking to make a purchase before the first or second stamp duty cut.

“But advisors also need to consider the end of the leave program and what it means for borrowers and the end of the mortgage deferral program, as some clients may find their mortgage unaffordable and look to reduce their mortgage payments. workforce. “

The remortgage will be lagging behind

Despite his predictions that loans will exceed £ 283bn this year, Thomas said remortgaging will be behind schedule.

He said: “[Remortgaging] can stay weak [and] was significantly below our forecast levels.

“I think part of this is because I think lenders probably prioritized clients who wanted to buy a home because lenders had limited resources because so many people were working from home.”

Thomas said refinancing had the potential to revert to pre-pandemic levels when bank staff returned to the office, but it may have been definitely overtaken by product transfers as the dominant means of changing agreements. mortgage.

Samantha Partington is a freelance commerce and consumer journalist who writes on real estate and personal finance. Previously, she worked for the Daily Mail and Property Week. She is the former associate editor of Mortgage Solutions and editor of Specialist Lending Solutions. Prior to becoming a journalist, Samantha worked as a mortgage broker and most recently for a mortgage, bridge and secured loan lender. Samantha is CeMAP qualified. Follow her on Twitter @ SamJPartington1.