Specialist market sees 'rebirth' with annual 19% growth: IMLA

Specialist mortgage lenders’ gross lending has been increasing by 19% per year since 2009, according to a new report from the Intermediary Mortgage Lenders Association titled ‘the rebirth of specialist lenders’.

Related topics:  Specialist Lending
Rozi Jones
3rd October 2017
House money pound price growth
"Mortgages are not ‘one size fits all’ products and as such the number of borrowers with ‘non-standard’ needs is increasing."

Specialist lenders have seen the total value of their lending increase to £17bn per year in 2016 – more than a threefold increase from the low base of £5bn recorded in 2009.

IMLA’s report also suggests the outlook for specialist lenders is positive, with market and economic conditions meaning demand from ‘non-standard’ borrowers is likely to remain buoyant.

It believes the rising share of mortgages are being sourced through intermediaries will also help support the market.

Additionally, IMLA highlights that specialist lending levels are way below those of the pre-financial crisis era, suggesting that there is substantial unmet demand. The number of self-employed people has increased to 4.8 million people in the UK, and there were a record 912,000 county court judgements issued against consumers in England and Wales which may limit people’s access to mainstream lending.

Peter Williams, Executive Director of IMLA, commented: “Specialist lenders have enjoyed strong growth since the end of the recession, largely through their focus on classically niche, less well-served areas of the market. Mortgages are not ‘one size fits all’ products and as such the number of borrowers with ‘non-standard’ needs is increasing. Through innovation and flexibility, combined with strong underwriting standards, specialist lenders have capitalised on the growing demand for products like specialist residential and lifetime mortgages.

“The growth of these lenders has been good for consumers too. It is important that mortgage finance is available to a broad range of borrowers, and by serving ‘non-standard’ areas of the market, specialist lenders are supporting inclusiveness while holding true to today’s strict affordability criteria.

“There is strong evidence to suggest that specialist lenders can now break the cycle that has defined the segment in the past. The range of borrowers who qualify for a mortgage on standard mainstream terms will remain restricted, and the mortgage market is also becoming increasingly intermediated.”

More like this
Latest from Property Reporter
Latest from Protection Reporter
CLOSE
Subscribe
to our newsletter

Join a community of over 30,000 intermediaries and keep up-to-date with industry news and upcoming events via our newsletter.