The Association of Mortgage Intermediaries’ chief executive has put out a plea for brokers to invest in their people, back office support and front office technology in order to survive in this changing market.
Speaking yesterday (7 September) afternoon at the Financial Conduct Authority’s mortgage conference, Robert Sinclair stated the industry has now mostly moved on from the Mortgage Market Review and must look to the future and address the next set of big issues.
He said: “Intermediaries need to rethink the structure of their businesses. Within a few years I’ll be walking into an office and asking for advice on my decumulation phase, but the problem is, while my home represents a huge part of the picture, they are unlikely to talk about equity release in the same conversation as retirement investments.
“My plea is for firms to investing in people, technology, back office support, because if you’re not in that space you won’t survive as the world changes; consumers will want more rounded advice in the future.”
Lynda Blackwell, the FCA’s mortgage sector manager, agreed that one of the key things going forward will be a “much more joined up approach” between investment, pension and mortgage advice, adding this was something likely to be part of the advice gap review currently being undertaken by the regulator and government.
Also speaking on the panel tackling the future of the mortgage industry was Legal and General’s group chief executive Nigel Wilson, also hoped that the consultation could help lead the way for better innovation in the sector, unencumbered by too much regulation.
“The intermediary share of the market is up to 69 per cent compared to 43 per cent in 2009, but the industry still needs to attract more mortgage advisers, firms must invest in systems, people and infrastructure, while lenders must remunerate them further,” he commented, adding that recent increases in procuration fees are a good start.
Mr Wilson outlined his group’s vision for the future, stating the lack of affordable housing in the UK represents a huge opportunity, with L&G already well on the way with various modular home developments across the country.
The firm’s recent foray into the equity release market, via the acquisition of Newlife, already means they are aiming to lend in excess of £100m this year.
He said: “There is a lack of equity release distribution though, this could be a £10bn a year market, but even that is still only 1 per cent of the housing equity owned by older people.”