So, let’s briefly evaluate three areas where intermediaries should currently be focusing their attention on.
Complex buy to let
In a recent trading update from Paragon, the bank highlighted its decision to focus efforts on “higher margin, professional business”.
Its specialist buy-to-let (BTL) lending grew by 1.1 per cent year-on-year to a total of £375.4m.
In addition, the quarter end pipeline figure for buy-to-let lending totalled £814m, up by 11.6 per cent from the same period the previous year, of which 92 per cent was classified as specialist lending.
This is indicative of the way the BTL market is moving.
All types of landlords are evaluating their portfolios – large and small – in terms of looking for ways to diversify, maximise yields, minimise costs and become more tax efficient.
The proportion of professional landlords is rising as some amateur landlords are selling up and moving on.
Additional market complexity and the growing proportion of business being generated by specialist lenders is only going to heap more importance on relationships, specialist distributors, quality of advice and a robust intermediary referral process moving forward.
Contributors to the Bridging Trends data transacted £732.7m of bridging loans in 2019, an annual fall of 4.5 per cent.
On the surface, this may seem somewhat disappointing, but when you consider the political uncertainty felt in the second half of 2019 it should not be underestimated.
The early weeks of 2020 have already seen a high number of enquiries with strong liquidity being exhibited among short-term lenders and competitive rates emerging.
Intermediaries can’t be expected to know all the intricacies attached to bridging finance, but this is where specialist distributors can help.
Later life lending
Research from Ipswich Building Society revealed that more than half of borrowers aged over 50 say they have fewer mortgage providers available to them compared to younger mortgage applicants.
This is despite the fact there are more than 60 lenders offering later life products for older borrowers.
This may well be the case but – as outlined by Richard Norrington, chief executive at Ipswich Building Society – the mortgage landscape for the over 50s looks entirely different now compared to just a few years ago.
However, this does not necessarily mean people’s perceptions have kept up and this also applies to some within the intermediary community.
This market is still developing but options and choice are constantly emerging for a variety of later life borrowers, especially through building societies and specialist lenders.