After what felt like a never-ending spell of bad weather, it was nice to enjoy several weeks of sunshine this month.

It seems we will need to wait a bit longer for ‘freedom day’ to roll in, but the direction of travel seems positive.

It is not at all doom and gloom, and I for one am fully enjoying the ability to once again socialise with others. I recently met with my management team for a well overdue catch-up. It was the first time I have seen some of them in-person for well over a year and it left me feeling energised and reminded me of the importance of spending time together outside of work.

I am extremely grateful that it is now possible to do this again. Virtual platforms like Zoom and Microsoft Teams have been a life saver over the past year, but video calls are only a substitute, and nothing can replace the morale-boosting benefits of being around others.

Of course, for the time being at least, we must remain cautious about how we do socialise and it seems remote working is set to continue for some time yet.

Striking the balance

Knowing how to reintegrate with work and loved ones is, of course, not the only question facing those in the mortgage market at present. Generally, it seems as though the market is in a state of flux and we are on the cusp of some other significant systemic changes.

In May, Legal & General Mortgage Club facilitated around £7.5bn in borrowing activity, which is a softening on the previous month and shows that the market is beginning to cool slightly. However, activity in June is set to increase, perhaps even to the levels seen in March, as many rush to beat the stamp duty holiday tapering.

It is obviously still busy, but things are beginning to normalise. Likewise, the balance between purchase and remortgage demand is looking more familiar and product transfers constituted 26% of our activity last month. We know there is a sizeable refinance market this year, with over 700,000 two- and five-year residential fixed rate mortgages due to mature in 2021, and advisers will likely need to shift focus from buyers to those looking to secure a new mortgage product.

A shifting tide

However, there is likely to be more change still. Our latest SmartrCriteria data tells an interesting story about the direction of travel. Consumer demands are changing and we have seen an interesting trend emerging among people looking to remortgage after less than six months of homeownership.

It is not completely clear what is driving this but strong house price growth and the opportunity to cash in on extra built-up equity could be playing a key role. Others are seeking capital raising mortgages – the improve not move approach remains relevant to many.

Whatever the case, this is all taking place amidst a backdrop of falling demand for products that are suited to people whose finances have been negatively impacted by the crisis. Demand for furlough-friendly mortgages, for instance, has dropped for two consecutive months, which is clearly positive.

Future sustainability

We’re certainly not out of the woods completely. The stamp duty holiday tapers down to its £250,000 nil-rate banding from July onwards and there could be another blip in demand as we approach its final stop date. Advisers need to be ready if things change rapidly by ensuring their business is operating as efficiently as possible.

What is clear is that the demand to move home is driven by much more than temporary tax reliefs. There are now several contributing factors at play, including the national reassessment in how and where we live, low borrowing costs, the potential for increased inward migration – as restrictions are eased – to fill emerging vacancies and, finally, clear signals from our SmartrCriteria platform which shows interest from international buyers remains strong.

This demand, without balancing measures around supply and better utilisation of our housing stock, will continue to support unsustainable – and for many prospective buyers unhelpful – rises in house prices. It will be interesting to see if any further fiscal or policy intervention in the housing market arises and if so, how this will impact this supply and demand balance.

Advisers need to be ready to adapt to the months to come and begin to prepare for the next wave of activity. Helping borrowers to secure their dream home is, after all, the ultimate goal for advisers.

Now is therefore time to prepare for this new wave of activity, to explore new opportunities and be on top of the business.

Legal & General Mortgage Club director Kevin Roberts