The housing and mortgage markets continue to generate a huge amount of column inches, largely centred around falling prices, subdued activity levels and the impact of a heightened interest and mortgage rate environment. According to Zoopla’s August House Price Index, sales are down 21% compared to 2022. Whilst it did outline that we are still on track for 1 million completions in 2023, this figure is set to be the lowest number of property sales since 2012, which obviously makes for a significant shortfall.

I’m sure that many brokers across the UK will have experienced a dip in the more vanilla end of their business streams over the past six to 12 months which leads to the question – what have they done about it?

Digging a little bit deeper. For those firms who have seen rapidly diminishing volumes, it would be interesting to see how these figures stack up compared to enquiry levels. By which I mean, if enquiry levels have remained relatively robust could it be the case that some brokers are losing potential completions because they can’t service certain new or existing client profiles which may have become increasingly complex?

This will inevitably depend on a host of factors including business models, operating processes, existing client base, market specialisms, target market etc, etc. And this is certainly not passing any judgement on those firms who have been highly profitable through writing substantial amounts of vanilla residential purchase and remortgage business over the years. But I can imagine that any monetary shortfall experienced in recent times may sting a little.

Now I’m no expert in the dark arts of marketing, lead generation or PR to bolster enquiry levels for individual adviser firms on a regional or national basis, but I do wonder if enough of those firms who are seeing revenues drop are successfully evaluating alternative ways in which to better service some of the more specialist borrowing requirements.

To support this mainstream residential dip, we are working with a growing number of brokers to bolster these specialist arms. For some, we are their specialist arm, for others who have more specialist lending experience we are there to support when and where we can on the more complex cases which need that bit more urgency, expertise and understanding. For example, being in a position to obtain a quick lending decision, knowing exactly where to place certain cases and how to package them in order to meet the tightest of deadlines.

When it comes to the types of specialist cases which are currently proving popular, it was interesting to see broker research from Castle Trust Bank uncover that refurbishment was the number one specialist property investment over the past three months, with nearly 40% of brokers saying it was the top choice for their clients.

Following closely behind were investments in HMOs and multi-unit freehold blocks (MUFBs). Despite the high profile of holiday lets, this was said to be the least popular type of specialist property investment over the last quarter.

In terms of choosing a bridging lender to finance their clients’ specialist property investments, it was reported that most brokers opt for speed of decision first, whilst certainty of decision is the second biggest consideration. Rate came in third on this list.

Certainty, speed and experience will remain key elements for all transactions across the short-term finance sector moving forward and, rest assured, that support is on hand to help brokers make up for some of those mainstream residential shortfalls.

Donna Wells, Managing Director at Envelop