There are a huge number of ways in which a broker can demonstrate their value for a variety of client types, but it’s vital to constantly evaluate how and where this is value is being added.
From a buy-to-let perspective, the market will see huge volumes of five-year fixes maturing following the introduction of new underwriting standards by the PRA back 2017. Equity generated over this time could be used for a variety of purposes, from adding to portfolios through to improving the energy efficiency of existing properties in line with upcoming legislative changes to Energy Performance Certificates (EPCs).
When we talk about advisers adding value in different ways, the topic of energy efficiency and EPCs offers a good example.
A recent survey from Shawbrook Bank found that one in seven (15%) of landlords have no knowledge of future shifts in legislation around EPC ratings. A quarter of landlords surveyed said they had little to no knowledge of the forthcoming changes, with long-time landlords – those who have been renting out properties for over 10 years – found to be less aware of the changes and what impact this could have on their properties. With a large proportion (36%) of landlords with properties built pre-1940, Shawbrook’s analysis suggests that a significant number of landlords will be required to upgrade their properties accordingly.
But how will they do this?
Firstly, advisers need to help landlords better understand the implications of such changes and understand the types of solutions which may help overcome them.
For example, might second charge or bridging finance play a prominent role within refurb processes for older property types?
For ARs, they also need to ask the question of how their network can support the shifting needs of their landlord clients.
Individual networks will obviously have their own approaches in terms of how they support their advisers and their clients. Generally speaking, the vast majority have excellent support structures in place but they do tend to differ when it comes to delivering specialist lending solutions. Our background in the specialist markets is well known. A number of our ARs have actually joined the F4B Network for this specific reason as we have an in-house packager to support all their specialist lending requirements. This is very rare within networks, as most do not offer this facility and tend to refer their specialist lending requirements out to a third party and split commission with them and this is something that advisers need to be aware of.
It’s not only brokers who need to demonstrate that they are consistently adding value. Networks also have to evolve and offer the type of in-house support which can make a real difference to their members business. And with the specialist lending market continuing to rise in prominence, this is an area where the strength of relationships and a lending panel offering a very broad spectrum of services, backed with packaging expertise can provide huge amounts of value.
Steve Swyny is commercial director at F4B Network