I relocated in January, leaving my partner Nicola to run The Mortgage Hut, while taking up the opportunity to oversee Mortgage Finder in Dubai.
Property Finder is the UAE’s leading property portal and it acquired Mortgage Finder, which was an already established business in the region for more than 10 years, in 2015.
It seemed I would be able to service more customers by offering a solution for their financial needs when purchasing a property.
Potential for international buyers
The concept of a mortgage broker is still relatively new here in comparison to the UK.
The intermediary concept was, in fact, non-existent prior to Mortgage Finder’s founding partners bringing the idea to the UAE over a decade ago.
In this time, banks have slowly been developing a better understanding of what a mortgage broker is.
There is still some way to go as a lot of the senior management at banks here come from places where mortgage broking is not necessarily one they have prior experience with and so cannot see the benefit of it straight away.
According to official figures, 11,000 mortgages were completed here in the UAE in 2017, and only 10-15 per cent of these were taken through brokers.
This is less than the number of mortgages that would be completed in the UK in a week.
Although the mortgage market is small in comparison to the UK, more than 45,000 properties were handed over in 2017 and there is a lot of potential with international buyers from countries such as India, Russia, other Gulf Cooperation Council (GCC) countries, and of course the UK and the USA.
Banks struggle for effective distribution
One of the main opportunities I can see for mortgage brokers in this market is that, like in the UK, banks can struggle to distribute their mortgage products in an effective way in this competitive market.
The UAE is comparable in that pricing in the market is tight and competition is tough, with lenders having very wide scoping criteria.
One difference here, is that unlike in the UK, lenders will negotiate on rates and criteria which can make it slightly more challenging for consumers.
This, however, is yet another opportunity for mortgage brokers in that they are called on to give clients advice based on experience and industry knowledge.
Brokers the way forward
Currently brokers only have 10-15 per cent of the mortgage lending market, which I see as a huge opportunity for our company moving forward.
Mortgage Finder controls over half that market and our business is about four times the size of any of our competitors.
We also benefit from having Property Finder as our parent company, as they have more technical power than most firms who are based in the UAE.
The message I have been sharing with banks here is that, like in the UK and other developed markets, brokers are the way forward.
In a challenging market, very similar to what we saw in 2008 in the UK, brokers are a flexible resource that can be used by the banks to control the quality, volume and distribution of their mortgage products in a cost effective way.
Where there is uncertainty, brokers can remove the pain of an expensive, inflexible workforce and are there no matter what the weather.
Chris Schutrups is founder and owner of Southampton-based mortgage broker firm, The Mortgage Hut, and managing director of Mortgage Finder in Dubai.