As a result of continued strong mortgage lending and lender system enhancements, Hometrack predicted the use of AVMs by lenders will treble within two years.
David Catt, commercial director of Hometrack, said: “The AVM market has increased enormously over the past two years. Hometrack has been the pioneer of AVMs in the UK and remains at the forefront of this expanding market, with mortgage lenders representing over 70 per cent of the market using our AVM. The expansion in this market is going to be phenomenal and on the back of our success in the lending community we are anticipating new players will enter this maturing market.”
Catt argued the government’s decision to allow Home Condition Reports (HCRs) to be a voluntary part of Home Information Packs (HIPs) would not stop lenders from using AVMs. He added: “The HIPs debate significantly raised the profile of AVMs. However, lenders had already recognised the importance of AVMs specifically for point-of-sale mortgages years ago, and this was irrespective of HCR introduction.”
James Cotton, mortgage specialist at London & Country, said: “I think lenders will increasingly begin to use AVMs. However, there will be restrictions on what can go through AVMs, such as the types of property and the loan-to-value ratio. Not every case will be able to go through AVMs, but lenders will put through as many cases this way as possible.”
