At times like this, it’s important to know that the fundamentals apply. By that, I mean that there are certain elements of the market which tend not to change, although we are obviously flying slightly blind when it comes to the overall impact of the coronavirus on the economy as a whole, the mortgage market, and (for us) the buy-to-let sector.
Certainly, the decisions and measures taken now will determine the overall impact and how long this might all last. The resilience of the mortgage market, and advisers in particular, can be in no doubt but I suspect we are all going to have to show new-found levels of grit and determination in order to get through (what I hope) will be a short-lived bump in the road.
How long that bump might go on for is anyone’s guess though. What I suspect is that we’re looking at a six-month period where the traditional norms may not apply in the way we have known them to. Already we have seen industry events being cancelled and postponed, and we must anticipate these won’t go ahead much before the Autumn at least. This means that the Spring and Summer will – in a lot of ways – be all about the core advisory business, that is, finding and dealing with mortgage cases.
Many advisers are, of course, self-employed, or part of small firms and therefore they’ll know what they need to do – business-wise – in order to maintain their living standards and keep the business functioning through this forthcoming period. Clients will still be coming to the end of special deals, so there will still be significant amounts of remortgage and product transfer cases to attend to.
And let’s not forget that landlords are in the same boat. They are predominantly running businesses with their property investments, or at the very least, they treat their properties as long-term investments. Their needs, when it comes to mortgage finance, will remain the same, and they will still expect to have those advisory needs serviced during this period.
In other words, both landlords and advisers are of the same ilk – they will want, and need, to ‘keep the world turning’ and therefore both need to be working together to achieve this. Remortgage and product transfer business will be available, and advisers must make their clients aware of how they can help them, what processes and systems they have in place to do this, and how they can work together.
What happens with purchasing is harder to call. Understandably, there is a nervousness amongst the estate agency community, because if the nation is in ‘lockdown’ then how can you get potential purchasers into properties to view them? Indeed, would the owners of such homes feel now was the right time to have their property on the market anyway? Would they want strangers coming into their homes if they’ve been told to distance themselves socially? We have to think no.
Certain properties will remain up for sale, by necessity, and that will deliver a base line of activity whatever the situation. And, lest we forget, that people are always going to need somewhere to live – the long-term investment opportunity that property has always provided will not be changing. If anything, given the nature of the stockmarket, investing in bricks and mortar may gain an even greater allure.
Again, advisers need to be making sure they are available to support those landlord clients who might wish to take advantage of investment opportunities that present themselves.
From our perspective, we will of course continue to maintain our proposition, products and lending to support the ongoing activity, whether that means from a staff base working remotely or within our head office or out in the field. That ability to work with our adviser, and other, partners will not go away, and we will always be available just a phone call or email away.
That’s a fundamental that I expect all mortgage market stakeholders to uphold. I’m sure advisers will be doing all they can to keep the business flowing and similarly we will be doing the same. It will be a tricky time for us all, but it will be temporary, and the important thing is to maintain service throughout this time and be in a position to handle all the business you possibly can.
Bob Young is chief executive officer of Fleet Mortgages