Could cross party politicians improve UK housing?

A leading London broker is calling on politicians to work together on a cross party strategy to improve the housing market in the UK.

Richard Campo (pictured), founder of Rose Capital Partners, a mortgage and protection broker, believes Britain should follow affordable housing models established in European countries, to boost the mortgage and property industries here.

“What we need is a long term, cross party plan,” Campo told Mortgage Introducer. “What needs to be done to help the mortgage and property industry is simple and can be done in three steps. The government needs to start building truly affordable homes - developers have not, and will not do it.

“This can be done quickly and cheaply using modern construction methods. Many other European countries already have proven models in how this works.”

How could build guarantees help housing?

Next, Campo suggests Westminster’s decision makers ‘work with lenders to offer guarantees on the build types used so they are suitable for lenders’.

He urged: “Only a government backed guarantee will shift the dial on this. While the above is simple, I know it isn’t easy. It is simple to lose weight – burn more calories than you consume, but that doesn’t make it easy.”

A general election draws ever closer, but Campo isn’t confident that his plan will be adopted anytime soon.

“I have lost count of housing ministers in recent years and the political environment is particularly toxic right now,” he reasoned. “The government has done next to nothing to help the industry in recent years and I can’t see that changing. They have been void of ideas and in the run up to an election I am sure they’ll go with some gimmick like low/no deposit mortgages and/or stamp duty reductions as they are perceived as easy vote winners.”

Campo set up his business in 2014. Based at London Bridge, it specialises in dealing with higher earners, with more complex incomes. He considers he’s been fortunate to forge good relationships with lenders over the years and believes that since the pandemic there’s been a shift in the way lenders interact with the broker community.

“I think COVID was a really good push to lenders to realise they really needed to engage with brokers and there are way more webinar/video meets and catch ups than ever before,” he explained. “Much like us engaging with our clients, the onus is on the lender to talk to us, as otherwise brokers will just stick to what they have done in the past.”

Why brokers should rethink which lenders they use

Campo suggests that because clients’ situations are more complex and their credit ‘a bit more patchy’, brokers need to refresh their thinking on which lenders to work with. “I think brokers need to be more open to using less mainstream lenders,” he remarked.

Retaining clients is an ongoing challenge for brokers, in Campo’s view.

“I think the biggest issue we will face will be clients just going back to their lenders for PTs (product transfers) when they may not be aware we can do that and get advice,” he offered. “Education and communication with your clients is key here as even if they do stay with their lender due to their situation changing or purely for the ease of it, getting advice is crucial.

“I always explain this as when you speak to the bank they’ll do what is best for them, when I advise you I do what is best for you. It’s a simple message but you need to engage with your clients to have that conversation in the first place. If any brokers are resting on their laurels just assuming clients will come back to them, they may well be in for a rude awakening.”

He continued: “It’s all about engagement - with your clients, lenders, peers, everyone. We live in a wonderful time where communication is so easy but that is equally the challenge as we are bombarded with notifications, emails, ads etc., so standing out is harder than ever. If we work together to educate clients on the benefits of independent financial advice, clients will follow.

“So, a joined up positive message around using brokers is what we need as opposed to small minded in-fighting or negative, fear-based messaging. Nothing turns clients off faster than the latter.”

2024 could be a good year for the mortgage market

The Rose Capital Partners founder believes this will be a positive year for the industry.

“Pricing on products is back to a normal level which is affordable to most clients but, crucially, pricing and inflation isn’t on an upward curve,” he noted. “When people see their pay cheque not go as far, and mortgages going up, it will always cause inertia. Now that has levelled off, and with the house price dip in the last year or so, it will be a good time for people to push on with a purchase if they have put that off for the last few years. We have seen mover enquires really spike since the end of last year, many of which are movers rather than first-time buyers (FTBs) which is great, as that will free up that FTB stock and get the market moving again.”

Campo reflected further: “Equally, pricing is now more palatable for refinancing, so it looks like the market will function normally again after years of ‘one off’ events. I think the industry is in good shape to get back to normal.”

He concluded: “A year of relative calm would be all I can wish for - no more plagues, wars or political insanity would be lovely.”