When dealing with mortgage advisory firms one of the main questions I often have to face is our ability to deal with the work provided to us.
“Do you have the capacity to handle our volume?” they ask and (thankfully) I have always been in a position to answer in the affirmative, plus I can point to the increase in investment and resource our business has put in place, particularly over the last six to 12 months.
While the market has not seen anywhere near the business levels of those pre-credit crunch days there has clearly been an improvement during that timescale and all stakeholders have needed to acknowledge this and react to it.
I can fully understand why advisers are keen to seek confidence about our ability to handle their work given the stories I often hear about the delays and difficulties many advisers (and their clients) have had with certain solicitor firms.
In the conveyancing market capacity is always a major issue particularly given the peaks and troughs the housing market can go through at any given time. Planning and preparation therefore are vitally important because if you get it wrong, you may find yourself having to make significant changes to your proposition based on the fact you are either over- or under-resourced. Therefore conveyancing firms need to have a focus not just on today’s workload but also the pipeline of business that is coming in and how the mortgage and housing markets might react in the mid- to long-term.
There’s been no doubt in my mind that many conveyancing firms were caught out last year by the improvement in the mortgage and housing markets.
While business levels increased more resource was needed to cope.
But some firms did not want to commit too much just in case the market improvement finished almost before it began.
In the end, the market sustained its momentum and firms had to ‘resource up’. But that meant that in the short-term service levels suffered because, for want of a better phrase, there was a lack of ‘bums on seats’.
As far as we are concerned we are now in a much more stable market which means we can be very clear about the business levels we are currently taking, and our capacity to take on more.
Goldsmith WIlliams
I suspect other firms are not so confident. Indeed, reading between the lines, the news that Goldsmith Williams has now stopped taking instructions direct from brokers might be to do with both capacity issues and, or perhaps, a feeling it is not best placed to work in what is a particularly competitive broker-facing market.
Many advisers will be surprised at the decision by Goldsmiths purely to align themselves with lenders for their work – especially as it has been a vocal player in the broker market for quite some time.
“Future capacity issues” was cited as a reason behind the decision and I suspect many other firms will also be looking at the service they can provide and the market they target from now on in order to head off any potential problems.
For what it’s worth, Blacks Connect has no intention of following suit and leaving the broker market – our doors are fully open to existing and new broker clients and we are working hard with all advisers to support them in their conveyancing endeavours. At this time the advisory community wants certainty from its partners, whether that be lenders, providers or conveyancers and we fully intend to stick with a market which we believe is growing in confidence and expects high levels of service and performance.
As always, our advice to intermediaries is to ensure they carry out the necessary due diligence on an existing or prospective partner.
Predicting these types of exits is difficult but firms can always make a decision on service levels at any time.
If they are not reaching the necessary heights then this could be a sign of things to come and brokers should certainly vote with their feet in order to secure the best service possible rather than putting up with something less than satisfactory.
