You are here: Home - Better Business - Business Skills -

Advisers: Your market share best is yet to come – BDRC

by: Tony Wornell, director, BDRC Continental
  • 23/03/2016
  • 0
Advisers: Your market share best is yet to come – BDRC
Mortgage intermediaries have never had it so good, as consumers seek out better deals and independent advice. Tony Wornell, director, BDRC Continental, discusses how brokers have gone from strength to strength.

“Most of our people have never had it so good”, Harold Macmillan, 20 July 1957.

Fifty years after our then Prime Minister’s famous sound bite, the same was true for UK mortgage intermediaries. Following over 20 years of long-term growth in their share of new mortgage business, the peak was reached in 2006-7, when intermediaries placed 57-58% of all new UK mortgages.

Then the sky fell in. The years from 2009 were extremely difficult, with intermediaries’ share of new business falling as low as 45%. Many went out of business; others soldiered on, making little or no profit. Since 2011, the intermediary channel has risen phoenix-like: by 2015, a record 59% of new mortgage takers reported using the intermediary channel, helped by the impact of the Mortgage Market Review.

Our monitoring of consumers’ future intentions suggests that there is further growth to come: between 2014 and 2015 there was a 10 percentage point rise in the share of future mortgage seekers intending to use an intermediary. The key drivers for consumers choosing the intermediary channel are ‘better deals’ and ‘better/independent advice’. The main perceived advantage of going direct is ‘no/lower fees’. Not offering advice can hit direct lenders hard: only 11% of mortgage holders like the idea of arranging a mortgage purely online versus 46% who dislike that idea (the rest don’t mind either way or have no clear views).

Intermediaries themselves have confirmed a sea change to us in their fortunes over recent years. Comparing our 2015 and 2011 studies:

  • The average intermediary’s annual case load is up by 29%.
  • There has been a lift of 32 percentage points in the share of intermediaries reporting a profit from their mortgage business.
  • And a lift of 42 percentage points in those feeling ‘very confident’ about the future outlook for their business.

While the average intermediary’s annual case load remains 15% below the 2007 peak, things have hardly ever been so good. As one said: “People need professional advice from a mortgage adviser. The banks are getting out and people are seeking advice from mortgage brokers.”

There are 0 Comment(s)

You may also be interested in

Business Skills

In this section, we offer short ‘how to’ guides on harder to crack areas of business. From social media, to regulation or niche product areas, we cover it all.

Profiles

Our journalists interview key industry entrepreneurs, strategists and commentators for day-to-day market insight and a strategic view of where the industry is heading. We offer lessons for success and explore the opportunities for your business

Success in Practice

Here, we share case studies fleshing out best practice to help you decide what could work for your business. Take a look at how others approached complex tasks like launching a new mortgage lender, advising on a new product area or deciding to specialise in another. Learn from others mistakes and triumphs.

Marketwatch

Each week, we ask top mortgage and property commentators with a unique perspective to examine a key news headline, market move or regulatory or political issue.

Poll

Vote in our weekly poll here. It’s your chance to tell us what you think and be heard on the top news stories of the week. Review our archive to find out what your industry really thinks and all our coverage of the results.

Top Comments

Be part of the conversation on Mortgage Solutions. We want to hear from you. We have a tool called Disqus to tell us which stories get the most comments each week. Every Friday, the team picks the most thoughtful or opinionated contributions from our readers to enjoy again. Don’t forget to share your favourite stories from the site on social media to keep the conversation going.
Read previous post:
picture of a buy-to-let property
Buy-to-let rental calculations likely to see ‘upward trend’

Brokers expect buy-to-let lenders to continue hiking rental calculations as changes to landlord tax relief draw closer.

Close