More than half (55 per cent) of intermediary mortgage lenders and a sizeable minority of brokers (40 per cent) expect the mortgage market to be hit with more regulation, new research shows.
This month new lending rules have come into force, including a requirement to “stress test” whether a potential borrower would cope if base rate rose by 3 per cent, and a cap on the volume of new loans a lender can make above 4.5 times the borrower’s annual income.
The research, from the Intermediary Mortgage Lenders Association (IMLA), also shows industry optimism over the mortgage market recovery is cooling.
In the first three months of 2014, 100 per cent of lenders and 90 per cent of brokers thought market conditions were improving; in the third quarter (July – September) just 44 per cent of lenders and 41 per cent of brokers still felt that way, while 45 per cent of brokers felt conditions were getting worse.
Concerns remain over the housing market with the third-quarter findings showing 31 per cent of lenders and 38 per cent of brokers believed house price growth was unsustainable, up from 13 per cent and 25 per cent in the first three months of the year.
However, data from national house price indices show that the monthly growth of house prices has since slowed.
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