Mortgage brokers have held their nerve in the face of a cooling housing market according to the latest data from the Intermediary Mortgage Lenders Association (IMLA).
The trade body’s Mortgage Market Tracker shows that intermediaries remained confident in both their own businesses and the wider sector during the second quarter of 2025, despite activity slowing sharply following the end of the stamp duty holiday in April.
Bank of England figures highlight the scale of the downturn, with gross secured lending dropping to £58 billion in Q2 from £76 billion in the first three months of the year.
Yet intermediary confidence in their own firms edged higher over the quarter, recovering from a dip in May to end June stronger.
CONFIDENCE FLAT
Long-term sentiment remains below pre-2022 levels but stability has returned after two years of volatility. Confidence in the outlook for the intermediary sector was broadly flat compared with the previous quarter but remained well above wider mortgage market sentiment.
Business flows showed signs of pressure, however. The average number of decisions in principle handled fell to 30 per intermediary, down from 33 in Q1, while application-to-completion conversion rates slipped to 61% – the lowest since the end of 2023.
DIP-to-completion conversion also fell, down seven percentage points to 35%, in line with late 2024 levels.
TOUGH MARKET
Even so, the average number of cases placed by brokers rose to 102 annually, up from 95 the quarter before, suggesting intermediaries are still finding opportunities in a tough market.
Mortgages accounted for two-thirds of all business, with buy-to-let representing just under a quarter and specialist lending around one in ten. First-time buyers remained the largest single customer group.
Kate Davies, Executive Director of IMLA, says: “As expected, Q2’s figures reflect the front loading of mortgage business in Q1 this year caused by the end of the stamp duty holiday in April.
“They also reflect a market adjusting to tighter than anticipated economic conditions, given the slow pace of Bank Base Rate cuts and continued pressure on household finances.
“However, intermediaries continue to demonstrate resilience and confidence in their ability to deliver.”
BUY-TO-LET BOUYANT
She adds: “Activity in the buy-to-let sector remains reassuringly buoyant, particularly in light of the concerns many have expressed over the imminent legislative changes the Renters’ Rights Bill will impose on landlords.
“This is an industry used to navigating uncertainty, and brokers are continuing to support customers through a complex lending environment.
“As interest rates and affordability gradually improve, and as more lenders implement looser regulation such as the increased Loan to Income flow limits, we hope to see greater momentum return to the mortgage market in the second half of the year.”
