Interest rate uncertainty and the ongoing cost of living crisis are major concerns for brokers over the year ahead but there is at least some confidence as we head into 2024.
This is according to the latest Crystal Specialist Finance annual survey which indicates that the tough market conditions were clearly felt as only 22% of brokers surveyed agreed that 2023 was a good year for their business – down from 48% in 2022. Some 77% told Crystal that business was the same or down on the previous year. Again, a significant increase from 53% in 2022.
But, despite this, brokers are more optimistic for 2024 with 31% confident about the year ahead and fewer worried at 8% (26% and 15% respectively last year.)
Their key concerns for the year ahead (at 74%) continue to be led by high interest rates and interest rate uncertainty. This figure is almost unchanged from last year when it was 76%.
The cost-of-living crisis is less of a concern at 64% (76% last year) and high inflation does not figure at all in the top challenges to business growth in 2024. High inflation was cited by 48% of responders in 2022 and so brokers clearly feel that the recent falls in inflation bode well for next year.
Brokers also feel that further Band of England base rate rises are behind us with only 17% believing it has further to go and 39% predicting a fall. (While over a third expect base rate to fall, over half of brokers polled thought the same thing this time last year!)
The industry has diversified this year with 35% moving into bridging, 28% buy to let and 26% commercial finance and 66% plan to continue to diversify in 2024.
Crystal conducted their annual survey with over 10,000 brokers for the second year running.
The use of technology is also of increasing importance to brokers, to enhance the speed of processing for their cases, with almost three quarters using digital case management to submit their deals.
And with 2024 being a general election year, brokers were asked which party they see forming the next government. Intermediaries are predicting a landslide victory for Labour at 73%.
Crystal managing director Jo Breeden comments: “While the wider residential housing market has further to fall as we move into 2024, brokers are more confident about the outlook. The new year presents opportunities for the resilient broker that is prepared to venture into new markets – such as bridging, commercial finance and complex buy to let,”
