Growth, diversification and maximising current clients top priorities, Altura Finance’s Gill says

Speaking to Specialist Lending Solutions, Gill said that Altura was had been set up initially with a focus on expats, securing Directly Appointed status so it could have more “flexibility” with working with clients from various countries or jurisdictions, but the volatility of the past five years had led to increasing diversification.

Altura Finance was founded in 2018, with a soft launch in Hong Kong before formally launching in London in 2019.

When it came to building its lender panel, Gill said that it went down the route of working with smaller regional building societies, challenger banks or specialist lenders and this opened the door for other areas of more specialist business like complex buy-to-let and high-net worth.

He also explained that in the last five years had had “half a dozen once in a hundred-year events” whether that was Brexit, the pandemic, mini Budget or war breaking out in mainland Europe.

“We very quickly built a panel that could not just service expats but could do a lot of other niche areas of the market and even specialist lending. So, we built a very flexible model that allows us to do lots of other things.”

Altura: ‘We are definitely looking to grow’

Gill said that pandemic had had a “big impact” on the business, and it had helped “shape its proposition”.

In 2020, Altura had been about to sign an agreement for corporate office space but as there was a lot of “uncertainty” in Hong Kong at the time, which had knock-on effects for UK business, it decided to hold off. Then the pandemic hit, and the company had “very successfully run the business from home” over the next six to 12 months.

“We had remained open over whether we were going to have employed advisers in an office, self-employed advisers in an office or not having an office. But that [the pandemic] helped us shape the proposition, we might have a central hub as an office, but actually we would concentrate on self-employed advisers, working either from their own offices or their own homes or with introducers such as estate agents that they work with. That would be our model going forward,” he explained.

Gill said that by the end of 2020, Altura had an adviser working in the South East in Devon and another adviser in the North East in Newcastle.

“We are very comfortable with the model of advisers working remotely, using our brand and our access to market but largely working remotely and occasionally coming into our central hub,” he noted.

The current headcount of Altura Finance is nine advisers, with one more joining the business imminently, two support staff and then three Appointed Representative firms.

“We are definitely looking to grow and having built this model around self-employed advisers, we’re looking to grow on that basis,” he said.

Gill said that it can offer self-employed adviser status under the Altura banner, and this could be for brokers who have “larger client banks”, or newer firms that “want to grow”.

“We’ll help them develop their businesses within a business so to speak. So, they can market our brand, we will go out to introducers with them and help set that up, and we will provide the infrastructure as well.

Gill said that the introducers who used this proposition were very “good advisers” but they may need “guidance around how to grow their client banks and how to do more with what they’ve got”.

“They haven’t got to worry about any of the branding, dealing with the Financial Conduct Authority (FCA), compliance or website, that all comes via us.”

Gill said that it currently had three ARs and more will be joining the firm soon.

“They come to us either as established ARs or new ARs because they want to grow. They want to use our expertise.

“Francois and I were at Coreco for eight to nine years and have grown the business from a standing start of five to six advisers to between 40 to 60 advisers at its peak, so we know how to help people develop and grow their own businesses.”

He noted that it was “doing a lot of work” with our advisers on how to get more out of their existing clients and existing introducers, whether that be “ongoing business protection, general insurance, and referrals”.

Diversification of lender choice vital for broker success

Looking ahead, he said that the purchase market would “come back” and the remortgage market may “take over” from product transfers as there was “more competitive rates now”, and there would be more opportunity to shop around as property prices stabilise.

He said that as purchase business had been down, remortgages and product transfers had grown in importance, but as the purchase market returned to normal levels, “it might be more difficult to place deals” as lender appetite may remain muted.

Therefore, it is important to have a “broader reach of lenders” rather than relying on mainstream lenders, and to look at smaller regional building societies or specialist lenders who can do higher loan to value mortgages or accept more adverse credit.

“It’s about being able to diversify and a big part of that is having access to a network who can provide access to lots of different lenders, including sorts of private banks and specialist lenders where relationships are very much key.”

He noted that for buy to let to return then it needed stress tests to come down, which was dependent on the base rate coming down.

“An area I think we will do well and has been resilient, and will continue to be resilient, is the high-net-worth and private banking arena. That market is always quite resilient as while borrowers don’t like paying higher interest rates ultimately most of these guys can afford to and they can and will if they need, they won’t put it off forever,” Gill said.

He said he was having conversations with clients who had been looking for the past six to eight months and were now starting to find a property.

“Property prices have maybe not softened dramatically in that arena or anywhere else for that matter, but it’s a little bit more palatable to pay the higher interest rate and you can get a slight discount on the property or at least more choice,” he added.

Another dynamic at play that could fuel the market was the end of restrictions on banker bonuses, which could be a “big boost to the property market in and around London”.

“I feel optimistic this year, I am hoping we have a nice boring year. No global pandemics, only one prime minister and no more wars,” he added.

Gill continued that the interest rate coming down was going to be a “big dynamic”, and that rate rises had curbed spending in the last 18 months, so it had had its intended effect.

“We should see the reverse that people do start coming back to the market and start borrowing money and banks are more flexible and looser in terms of lending money so we can all do more business to help more clients and the property market picks up as well with more transactions.

“So, I’m hopeful for a nice, boring year. With interest rates coming down on we can all just get on and run our businesses in what’s considered a more normal market without sort of massive shocks or interest rates higher than they need to be,” he said.