Mortgage intermediaries remained confident in their businesses and the intermediary sector during Q2, despite a softening in market activity following the end of the stamp duty holiday in April, according to the latest research from the Intermediary Mortgage Lenders Association (IMLA).
Bank of England figures recorded a steep fall in overall gross secured lending from £76bn in Q1 to £58bn in Q2.
Intermediary confidence in their own businesses edged up in Q2 2025, with a slight fall in May recovering in June. While long-term confidence remains below pre-2022 (Truss) levels, sentiment has stabilised following recent volatility. Confidence in the outlook for the intermediary sector was broadly flat compared with Q1, dipping in June but remaining stronger than for the wider mortgage market.
The average number of cases placed by mortgage intermediaries annually increased to 102, up from 95 the previous quarter.
While confidence held firm, business flow indicators showed some slight signs of strain. The number of DIPs dealt with fell to 30 from 33 in Q1, but was still up compared to the levels at the end of last year. The average conversion from full application to completion decreased to 61% – the lowest since the end of 2023. Conversion from DIP to completion also declined by seven percentage points to 35%, matching the level seen in Q4 2024.
In terms of business mix, residential mortgages continued to make up two-thirds of intermediaries’ business, with buy-to-let accounting for just under a quarter, despite concerns around the impact of the Renters’ Rights Bill. Specialist lending represented around one in ten cases. First-time buyers remained the largest customer segment.
Kate Davies, executive director of IMLA, commented: “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.
“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.”
