"Working with experts, who deeply understand the specialist market and how things are developing, can be the difference between a case going through or failing."
It’s been a strong start to the year for the specialist market, whether you are working with residential or investor clients. That’s something that we have seen first hand at Pure Panel Management on the valuations our team has worked on.
Second charge borrowing, for example, has really come into focus for residential owners looking to tap into the equity they hold in a property, without touching their original mortgage. For some, this will be in order to consolidate outstanding debts - a pressing consideration after the challenges of the last few years - while others see this as an opportunity to carry out desired home improvements.
This drive is reflected in the most recent figures from the Finance & Leasing Association, which show that the value and number of second charge mortgage applications in the 12 months to February are up by 31% and 22% respectively on the same period last year.
Among investors, we have also seen a jump in interest in bridging loans. With property prices coming under pressure, and some residential buyers putting off their purchasing plans, that has presented a fantastic opportunity to investors looking to add new properties to their portfolio. Bridging loans allow those investors to snap up those properties, and raise the funds for improvement work, more rapidly than if they relied on a regular buy-to-let mortgage.
Within the buy-to-let market, there has also been particularly strong interest among landlords in houses in multiple occupancy (HMOs). It’s clear that, for all of the challenges the buy-to-let market presents to investors at the moment, there remains strong confidence in property as a long-term asset, particularly given the ongoing housing shortage shows little sign of being solved any time soon.
Brokers will know only too well how the specialist mortgage market is flourishing at the moment, through their own interactions with clients interested in everything from second charge and bridging to complex buy-to-let.
As interest from borrowers in these products has grown, so too has the understanding brokers have of these areas, with advisers electing to either enter into directly helping such clients, or partnering with specialists who they can refer the client to.
Partnerships are vital
However, even for intermediaries who handle advice on specialist cases themselves, partnerships are absolutely crucial. After all, there is more to completing a case successfully than simply identifying the right mortgage deal.
For example, brokers may benefit from taking a more hands-on role in the selection of a conveyancer, knowing that working with the right business can help the client enjoy a smoother and more satisfying experience.
One area where this can be overlooked is valuations, yet there’s no question that working with the right valuers can make a huge difference to how smoothly the case proceeds.
Working with experts, who deeply understand the specialist market and how things are developing, can be the difference between a case going through or failing. All brokers will have horror stories of how unnecessary delays have led to a purchase collapsing, leaving the client disappointed and - perhaps even more importantly - out of pocket.
While it can be tempting to opt for an automated model in order to keep things moving, the reality is that physical valuations do not have to be slow and overly onerous. Ultimately it all comes down to the valuer you work with on the case, and their level of expertise in turning a case around swiftly.
At Pure, our current average turnaround time from instruction to having the report back with the lender is around four days, the sort of timescale that allows swift progress on cases of all kinds, particularly those specialist deals where time may be even more of the essence. A full internal also allows the surveyor to ensure the client isn’t buying anything they shouldn’t be and that nothing has been missed when they have viewed the property. The small outlay upfront can end up saving a fortune in the future and finding property issues early can stop investment properties turning into money pits that, in the current climate, a number of customers simply can’t afford.
It’s about relationships
The property industry is built on partnerships, or perhaps more accurately, on relationships.
Brokers have always appreciated working with lenders with whom they have a strong relationship, when they know that if there is an issue they can pick up the phone and speak to someone who can help push the case along.
It’s the same with the valuation market. At Pure, we have always put a premium on building those long-lasting relationships with lenders and brokers alike. Maintaining a personal approach, and being available to support advisers if and when issues arise, not only sets us apart from other panel managers but also means we can deliver a more comprehensive and efficient service.
The specialist market is only likely to grow in importance over the months and years ahead. Working with valuation partners who understand this market, and can provide a personal valuation service within a tight timescale, means brokers can deliver the best possible experience to their specialist clients.
