myi: How are you finding the current market conditions?
The market remains tough but is manageable. Looking at our current level of activity, I am confident that the financial services will exceed its profitability to its highest levels since 2008.
The buy-to-let and remortgage markets continues to perform better and remains steady, allowing us to focus our attention on purchase activity.
myi: In your opinion, what can lenders do to boost lending levels?
Lenders are hamstrung by their liquidity and funding position, therefore I am unsure that we will see a huge spike in available funds in the gross mortgage market.
Encouragingly, there is no doubt that product availability is easier but still not ideal - whilst 90 LTV mortgages are now widely available, there are still too many restrictions linked to them.
In the buy-to-let market, we have an abundance of vanilla mortgage products at 75 percent LTV. In another area of the market , lenders need to offer prime new build products at 80 percent for flats and 90 percent for houses.
Of course 95 percent prime LTV would be great – but it will remain restrictive. But, as the CML themselves have also pointed out, it is the level of deposit not affordability that is the main concern for consumers.
myi: What are your expectations for the rest of the year and 2012?
2011 will be lower than 2010 £130-135bn but we anticipate marginal improvements to progress in 2012 with a gross lending market closer to £150bn. Assuming of course that the Euro doesn’t implode!!
myi:What has helped you to weather the storm during the credit crunch?
All businesses can do two things, look at ways to generate revenue and most importantly implement cost efficiencies. Countrywide has done both.
We have also bought and established businesses in the sector that we believe can also weather the storm and have the potential to grow dramatically - Mortgage Intelligence and Capital Private Finance.
These businesses have a very good management structures and business models to ensure that they reap the benefits when we see the upturn in the market.
myi: What has been your biggest help throughout this difficult financial climate?
The capital reorganisation of Countrywide’s balance sheet in May 2009 meant we had a reduced debt burden and increased cash levels.
This has enabled us to be a consolidator in the mortgage distribution market. It is impossible to overestimate how important this was. It has set us up to be the biggest estate agency, letting agency, single mortgage broker, conveyancer and the second largest surveyor in the country.
myi: What do you expect the mortgage market to look like in 2012 and onwards?
We will see slow but steady growth, carefully funded by lenders to such an extent that by 2015 we anticipate to be operating in a market with £180-200bn gross lending volumes..
The big unknown is the extent of the remortgage activity when the base rate begins to increase. I wouldn't be surprised if some lenders begin to regulate the volume of remortgaging and possibly reduce the remortgage products offered through broker channels.
myi: How do you see the working practices of independent Financial Advisors and Mortgage Brokers changing in the future?
Regulation will add an increasing cost burden to independent mortgage brokers so I'd expect them to reduce over time.
It is difficult to make money as solely a mortgage broker so qualifications and RDR will play a part.
That said when remortgage levels increase, I wouldn't be surprised if some IFAs move into the mortgage market and the number of mortgage brokers increases from its current levels.
myi: Having worked in the financial services industry for a number of years – both in a lender environment and now as a broker, what are the major positive changes you have seen in the industry over the last few years?
Continued innovation and increased professionalism. The brokers and firms that remain in the industry have had to learn to operate in a market that is almost of third of the level it was in 20087.
These firms are now much better capitalised, they have had to adapt their service offering and now have much better service standards and compliance procedures.
myi: …and the negatives?
Some great people have been affected and exited the industry, which is very sad.
Lenders and brokers have been heavily impacted. In LBG , there are 40% less people in mortgages than 4 years ago.
Consumers are the people I feel most sorry for. Getting a mortgage is now sometimes difficult , especially if you are self employed or have even small CCJs.
This will remain the case until the industry ALL get together and say mortgages are available and we are all ready to help you into your home – which is exactly what the government, lenders and brokers must do.
myi: How do you feel Countrywide differs from its competition?
Countrywide’s scale, capital position and perhaps most importantly, its ability to innovate and diversify the service propositions to our customers and clients needs, enables us to build upon our status of the UK largest property services group.
We are able to move a large number of people into the market. A good example is the recent push into Land and New Homes - from a lending viewpoint but also fro
