Let’s start talking up the market
John Phillips (pictured) is group operations director of Just Mortgages and Spicerhaart
Nationwide’s January housing figures seem to show that our market is still resilient. There is a definite trend in the mainstream media to talk down both the economy and the country which is not doing anyone any favours, and what’s more, it is completely at odds with the fact that in many respects the economy is going well – and that includes the housing market.
The Nationwide January house price figures showed that house prices leapt to an annual rise of 3.2% – a rise that was also reflected in the Spicerhaart figures for the start of the year.
This reflects the fact that the need for housing is as strong as ever and the key issue remains having enough housing for everybody who would like to buy. Everybody needs a place to live, so it is always a good time to buy a house.
This isn’t being naive and pretending there won’t be challenges to overcome, but rather to focus more on the positive and recognise that there will always be opportunities both in the housing market and even more so in mortgages. Yes there will be seasonal dips, as there was in December, but the sensible approach is recognising when a slow month is just a one off or a seasonal event, rather than interpreting it as the start of Armageddon.
Part of the problem is that news reporting tends, not only to be negative, but also to be very London centric, when the rest of the UK is, and has been, very different to that of London. Since the referendum the rest of the country has very much been business as usual, whereas London seems to have been broadsided much more and this has brought undue negativity to much of the mainstream reporting.
What the negative reporting may well do is slow down the more cautious of the population from making a move when they want to. This is leading to lots of pent up demand, with part of the populace not moving until they are more certain about what the future may hold. This doesn’t mean they don’t want to move, just that some people are cautious about doing so right now, which has to be a contributory factor to a smaller number of properties coming to market.
However the UK population as a whole is remarkably resilient. Whatever the news, most people carry on and make the most of it to which the more positive figures are a testament. Therefore positive news is likely to persuade those people who are sitting on their hands to take action instead – but this positive news doesn’t have to come just from the media and can put the broker in an influential position.
Positive communication with an existing client bank to tell them just what opportunities are available, either to buy, to extend their existing property or just to remortgage is likely to receive a positive response – even if not immediately.
We ran a remortgage campaign just after last year’s rate rise for example, and many people who had said no to remortgaging previously then said yes.
Yes, there was a trigger, but there are also other triggers that can be used: new low rates, more lenient criteria or even events in your clients’ lives. What this campaign proved was that for brokers who keep plugging away, providing their clients with regular timely information, they may well find it yields a surprisingly positive response.
Many people are very open to hear that things are not as bad as they read about in the press and brokers can play a very valuable role in that.