"I'd say brokers have their finger on the pulse like no one else in the industry. We're the ones talking to clients and seeing the very real issues at the coal face."
The Labour Party has announced it will be hosting an emergency mortgage summit with brokers this week.
The summit, scheduled to be held this Wednesday in London, will be overseen by Shadow Chancellor Rachel Reeves and Shadow Housing Secretary, Lisa Nandy.
Lisa Nandy said: "Too often, families who are saving for their first home but getting no closer to buying it tell me that they feel like they’re doing something wrong.
“But there is a common denominator here when it comes to our broken housing market, insecure economy, soaring prices and broken public services – and that is a Tory government that has failed to achieve anything in the last 13 years.
“Nowhere is that more true than on homeownership, with more and more people locked out of the market, or forced to pay hundreds of pounds a month more because of the Tory mortgage bombshell.
“It is clear that the Labour Party is now the only choice for people who dream of owning their own homes.”
Brokers react
Newspage asked brokers and intermediaries what they would be saying if they were to attend - and also who should attend.
Jonathan Miller, director at 365ifa: "For this summit to be successful, the conversations need to be with independent brokers, ranging from small to large. Corporates and trade bodies are too far removed from the coal face to have meaningful input. Are people who haven't been in front of a client for 10-15 years the people that can provide the feedback Rachel and Lisa seek in such times? In my opinion, no. They need to know how individuals are coping and accepting the current rates being thrust upon them. This can only be provided by those giving the advice."
Rhys Schofield, director at Peak Mortgages and Protection: "How I'd love to be involved in a summit like this. I'd say brokers have their finger on the pulse like no one else in the industry. We're the ones talking to clients and seeing the very real issues at the coal face. In regards to questions, I'd like to ask what actions could be taken for clients who simply can't afford their new payments? Options like a stamp duty holiday for people downsizing, or a six-month payment holiday whilst they do so. Both the public and brokers are pretty darn resourceful and we could help a lot of people in a pickle with a few more tools in our arsenal. Making people's lives easier doesn't actually have to cost too much money."
Jamie Lennox, director at Dimora Mortgages: "Real brokers on the ground level need to be the voice of the next generation of homeowners as they see and understand the struggles being faced by many first-time buyers. There needs to be some real thought around getting builders to build. The planning process is long and slow and needs to be reshaped. We then need to look at a viable scheme to replace Help to Buy, which has left a gaping hole in the market."
Justin Moy, managing director at EHF Mortgages: "Given that around 80% of all mortgages are via intermediaries and brokers, naturally they should have a proportionate percentage of the space at this summit. We see the effect of high rates every day, have to deal with the negativity it is spreading, and counsel those who need huge support and reassurance. Not those three times removed from the process, whose last mortgage may have been 20 years ago. This should reflect the largest and some of the smallest broker firms, too, as there is an impact on our people, as much as the borrowers. I would discuss the role of the Bank of England in setting rates, and the lack of tools they have around ways to curb inflation. If we adopted a more European model of long-term rates, the base rate becomes redundant, so how else would the government and Bank of England control inflation? Would increasing spending taxes, like VAT, be a better way to control inflation, and spread the responsibility to everyone, not the minority?"
Lewis Shaw, founder and mortgage Expert at Shaw Financial Services: "I don't see how talking to mortgage brokers would help. Every political party is fiddling while Rome burns. Tinkering at the edges with short-term gimmicks is not the way forward. The only way to solve the housing crisis and most economic woes is to transform our taxation system. We should scrap our current tax system altogether and implement a land value tax because land as a commodity is almost perfectly inelastic. This would increase productivity across the board; it would rebalance the grotesque wealth inequality in the UK, make homes more affordable and lessen the amount of rent-seeking, unproductive behaviour that is preventing genuine innovation. Unless we see that kind of radical policy, all that will happen is homeownership rates will continue to reduce and wealth inequality will worsen. We'll continue to travel headlong back into a feudal society."
Andrew Montlake, managing director at Coreco: "This is a great initiative from the Labour Party and engaging with mortgage professionals who are working with borrowers day-to-day on the front line shows a determination to fully understand and look for solutions to the current mortgage-related issues. It is important for political parties to show an understanding of every aspect of the home buying process, rather than just focusing on one group, and this opportunity to engage with a broad spread of mortgage professionals around the table will stand them in good stead. I have said before that the housing market is of the utmost economic and social importance, which needs a long-term plan, and a cross-party approach involving a spread of industry professionals, rather than a short-term focus that is blown about in the backdrafts of ever-changing Housing Ministers. I look forward to this engagement and a fresh approach."
Graham Cox, founder at SelfEmployedMortgageHub.com: "Out of this mess is a great opportunity to completely rethink UK housing policy. My message to Labour would be to allow house prices to fall, whilst implementing temporary measures that allow people to keep their homes, whether that be extended terms up to age 80 if necessary, allowing interest-only for a period, or payment holidays. We also need to ensure private tenants have easily enforceable rights, and section 21 notices are abolished. Longer-term, we must look at measures that maintain property prices at a maximum of five times average income. That means including house price inflation in the 2% annual inflation target, and giving local authorities and good housing associations the means to build truly affordable social housing at scale. We need bold, radical steps now. The status quo is simply unsustainable, economically illiterate, and deeply unfair, particularly on the young."
Amit Patel, adviser at Trinity Finance: "Small independent mortgage brokers rather than corporates should attend the event as we have a better understanding of the situation facing our clients at a local level. The Bank of England needs to help borrowers, renters and small to medium-sized business owners with the costs of borrowing by beginning to reduce the base rate, as clearly their strategy to bring inflation down has not worked so far. Greedflation is why inflation remains stubbornly high and this needs to be addressed as a priority."
Rob Gill, managing director at Altura Mortgage Finance: "With between 80%-90% of all mortgages conducted via a mortgage broker, involving them in any response to the current situation in the mortgage market is a very sensible proposal from Labour. Brokers are very much on the front line and are seen as trusted advisers by many clients, often the first call for any borrower with questions or concerns. A Mortgage Broker Charter, clarifying and publicising what brokers do, and complementing the lender version already up and running, should be among the discussion points."
