Q: Everyone is looking towards 2014 and formulating plans for the new year. In which areas of the market do you expect to see big growth?
A: 2014 promises to be full of opportunity for brokers, and already sentiment in the market is largely positive. In a recent broker survey we conducted, nearly two-thirds of respondents thought intermediary market share would exceed 60% next year.
One of the major topics on the agenda for 2014 is of course the Mortgage Market Review (MMR). In many cases, the issues MMR is looking to address have already been rectified by the industry.
Come April 2014 it is therefore unlikely its implementation will be a ‘big bang’ type event for intermediaries. Brokers can expect a more gradual change, with some adjustments already starting to take place.
The biggest impact MMR is set to have is the better packaging of products. Brokers will not only need full knowledge of the lender’s criteria, but they must also work to ensure they match their clients’ specific needs to those criteria.
Although this practice is already being carried out by many brokers, come 2014 lenders will be expecting a higher standard of relevant applications. Ultimately this will drive quality and for the industry as a whole can only be seen as a good thing.
MMR aside, there are plenty of other opportunities for brokers in 2014. All of the brokers we surveyed said they expect to write more business next year compared to 2013, with 27% predicting gross lending figures to exceed £180bn.
With this in mind, there are four areas I would recommend brokers focus on:
New build is a growing market with great scope for brokers to get involved. It offers the potential to get in front of a new, loyal and long-term customers.
There are plenty of great remortgage deals available at the minute, so brokers need to make sure they are not neglecting their back books. Don’t let competitors or lenders have these conversations in place of you.
Buy-to-let is a £20bn market, and growing. There are lots of opportunities here that are yet to be tapped into.
Next year could also be a prime time for intermediaries to invest in creating capacity for the above areas, or to create deeper relationships with customers.
From a mortgage club perspective, we hope to see the appropriate recognition of brokers next year. With MMR on the horizon, lenders will be expecting intermediaries to take on a significantly more work. We feel brokers need to be acknowledged. This could be in the form of products, criteria or even appropriate fees.