When will things get back to normal?
“When will things get back to normal?” is a common cry amongst the mortgage market at the moment. At the recent “Mortgage Event” conference it was interesting to hear Martin Reynolds of PMS take this question head on. His position on the matter was refreshing – the last 5 or 6 years were the abnormal times and we are just returning to the “Norm” now.
Once the media hype and hysteria is stripped away there is some evidence to support Martin on this. For example, if gross lending falls back to around £250 billion it will still be probably the 6th largest on record. The removal of 100% plus mortgages and the sharp reduction in the sub prime and self certification mortgages leaves the market in a similar position to the market of the last decade. While clearly these changes remove the boom times of the last few years it doesn’t kill the mortgage market.
The difference this time around however is that the distributors are smarter and fitter. Market conditions have been tough in 2008 as we have been diving back to the “Norm”, and this has forced a leaner breed of broker. Lenders have been selective with which brokers they deal with, encouraging investment in new processes and technology to improve the quality of the business submitted and the accuracy of the applications. Brokers have been driving to meet the TCF guidelines again embracing technology to help them on the way. So while the market conditions may return to the long term “Norm” soon, the distributors are better placed to work this “Norm” and benefit accordingly.
Written by Mark Loosmore - Visit Website