Stephen Smith, Legal & General's Director of Housing said: "At last, after a year of falling adviser confidence, our data shows a slight upturn in sentiment. Twenty seven per cent of the advisers within our mortgage network that we spoke to said that they expected business to get better over the next three months and a further 40% expected a flat trend.
The dramatic cuts in the bank base rate have played a part in the newfound confidence, but it is only significant if it is reflected in consumer behaviour. Perhaps there is also a bit of pre-Christmas optimism amongst advisers, but whatever the case, protection remains extremely important for advisers and consumers alike. Over a third of advisers expect protection sales to improve over the next quarter. For a product that is sold rather than bought, maybe advisers are finding that the recession is making their clients more receptive to the idea of protecting their debt and income."
"House purchase mortgages continue to be as rare as red panda, with 71% of advisers saying that these customers won't even represent more than a fifth of their mortgage business over the next quarter. Nineteen per cent of brokers say they will mostly be dealing in remortgages.
"The vast majority of advisers are predicting a further base rate cut next month, with half of them foreseeing a reduction from 3% to 2.5%. Hopefully this will buoy confidence further, although it remains to be seen what affect a tough winter and the inevitable festive slowdown will have on our advisers' confidence in our next report."
Key findings of the report:
Twenty seven per cent of advisers expect business to get better over the next quarter - a welcome upturn from 21% last quarter
There are continued signs of optimism in the protection market. 36% of advisers expect protection sales to improve over the coming quarter and a further 45% expect sales to remain the same
Yet again, the proportion of house purchase mortgage business is expected to shrink. 71% of advisers expect house purchase to represent between 0-20% of their mortgage sales over the next three months
For most of the year, many advisers have been indicating that remortgage business will make up around 61%-80% of their mortgage income
