CEO is disappointed there's not been more progress in addressing homebuyer issues
The progress the mortgage industry has made in addressing the real problems facing homebuyers is disappointing, according to the CEO of London-based fintech mortgage lender Gen H.
Will Rice (pictured) considers that the market is ‘difficult to disrupt’ for an incoming business, and has gone back from where it was even a decade ago. He also believes the UK is missing a plan to address its housing crisis.
“The pace of change in our industry is very slow and I think the progress made in the past five years has been disappointing,” he told Mortgage Introducer.
“To start with some positives, we’ve seen lenders such as Skipton and Accord put their necks out to help more first-time buyers, while service levels for mortgage applications have improved greatly across most lenders.
“But, if we zoom out and look at the real problems facing home buyers - affordability, time to completion, transaction cost and complexity - the market has not made any inroads and in most cases we’re in a worse place than five or 10 years ago.”
Remaining positive in the face of adversity is key, Rice suggested.
“It would be easy to become despondent about the state of our industry, which is why one needs to cultivate a relentless optimism to have staying power and earn the opportunity to drive real change,” he said.
Rice heads up Gen H, which launched in 2019 and aims to broaden access to homeownership for aspiring first-time buyers, while also supporting others in the homebuying market, including those looking to remortgage.
“Building the business has been very demanding,” he reflected. “The mortgage market is very difficult to disrupt, with the big banks operating with a deep moat afforded by an ocean of low-cost deposits. Regulation also creates significant overheads - direct and indirect - that can be difficult to shoulder as a young business. But now is a very exciting time for us as we’ve pushed through a lot of challenges and are able to reap the rewards of the last few years of investment.”
Is the UK’s housing crisis being addressed?
Rice shared his concerns about how the UK’s housing problems will be overcome – he believes more needs to be done in terms of a strategy, and the private sector can play a bigger role.
“What continues to concern me on a macro level is the absence of a comprehensive plan to resolve the housing crisis,” he said. “The new Labour government is still finding its feet so I remain hopeful that this vision will come in time. When it does, it is essential that it encompasses supply- and demand-side reforms. With the right top-down support, there is a hell of a lot more that the private sector can be doing to resolve the nation’s housing crisis.”
He added: “In the coming 12 months, the real measure of success will be whether we can achieve a shared vision of how to solve the housing crisis, getting stakeholders to all pull together in the same direction.”
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How important are mortgage brokers for homebuyers?
Rice described Gen H’s partnership with brokers as the bedrock of the business and said the value of a good broker cannot be overstated.
“Homebuyers need a reliable guide to a complex market,” he noted. “Products need to change, and sometimes become more complicated, to address evolving customer needs. But product innovation can only find a place in the market if there are brokers who are willing to take the time to understand the new product and determine whether they can use it to deliver better outcomes for their clients. In this sense, brokers play the critical role of midwife to product innovation.”
Rice urged brokers to make sure they are across the detail of all the new affordability solutions that are available in market. As a lender that aspires to drive change through innovation, he said, it is absolutely essential that customers are getting the high quality advice required to make the right decisions.
“We start with the needs of the homebuyer and work backwards to find the right solutions to solve their problems,” he explained. “We’ve had this ethos from day one, and it’s reflected in our customer-centric product design.
“We are unusual in the market in having built proprietary software to serve our customers across both loan origination and servicing. Controlling the customer experience is essential to us.”
Rice said he had learned in business the value of over-communicating to stakeholders, whether that’s customers, employees, board members or partners.
“It’s not my natural instinct to overshare, so I’m still working on building the required muscle memory,” he observed.
