IMLA calls for realistic view of the mortgage market
The Intermediary Mortgage Lenders Association (IMLA) is taking a realistic view of the future of the mortgage market based on the evidence of past performance.
This move is designed to provide some clarity following mixed predictions from leading commentators in the sector over the last few weeks.
IMLA executive director Peter Williams explained that even the most optimistic assessment of an average three per cent rise is in line with inflation, so “the best prices would be virtually flat in real-terms”.
Increases in mortgage arrears and repossession have been highlighted as an indicator of a 2008 house price crash, but Mr Williams provides a lucid rebuke of this theory.
He said: “Looking back at 1991 repossessions were running at over 75,000 in the year and almost 0.8 per cent of mortgages. We are a long way from that, even in 2008.
“If the market correction gathers pace in the way some pundits suggest, then we should expect firm action by the Bank of England to support the financial markets, provide liquidity and, if necessary, cut rates to protect confidence and help the markets recover over the medium term.”
