"Advisers need easy access to a range of alternative forms of finance and understand exactly how they fit within a variety of complex borrowing scenarios which are likely to emerge"
This comes on the back of inflation rising to a new 40-year high of 9.4% in June and over two-thirds (68%) of UK chief financial officers (CFOs) believing that high levels of inflation will continue and go on to exceed economists’ expectations. In addition, 63% of respondents assigned the probability of the UK experiencing a recession within the next year amid these heightened inflationary conditions and intensifying economic headwinds.
This is according to new research from Deloitte which, on a more positive note, also suggested that increasing capital spending remains a strong priority for 19% of CFOs, remaining above the five-year average of 14%. CFOs were also reported to be optimistic about medium-term prospects for investment and most expect business productivity, spending on skills and investment in digital technology and assets to speed up in the next three years.
Another positive and interesting takeaway from this research was highlighted in the commentary around this which suggested that CFOs are not in batten down the hatches mode despite these concerns. Risk appetite remains only slightly below average levels and well above the lows seen in the financial crisis at the time of the EU referendum and during the pandemic.
Sentiments such as these demonstrate how important it is to read beyond the headlines, not to mention how opportunities often still emerge even in what may appear to be the darkest of times.
From a mortgage market perspective, we are fortunate enough to be entering some challenging times for potential and existing borrowers from a highly robust lending platform. One of the main reasons for this is the emergence of a specialist lending market which is demonstrating a far more varied, responsible and professional approach. The solutions on offer from such lenders will prove vital for those borrowers who may have fallen on hard times in recent times and for the ones who are starting to be impacted by rising living costs and the resultant strain placed on affordability levels.
Quality of advice will prove integral in overcoming these challenges every step of the way, from the initial fact find through to providing and delivering the right kind of complex solutions to meet clients ever-shifting demands. Quality of support is also a key factor. Advisers need easy access to a range of alternative forms of finance and understand exactly how they fit within a variety of complex borrowing scenarios which are likely to emerge as additional pressures are being placed on individual and household finances.
Opening up simple and effective routes to such forms of finance and having the backing of an experienced and extensive network offering will help intermediary firms protect more clients and help maximise opportunities. And when combined with the additional support of a trusted packaging partner who can do all the heavy lifting for cases which might be out of an adviser’s comfort zone, this could help more intermediary firms to recession proof their business going forward.
