The Intermediary speaks to Richard Fearon about the Society’s record-breaking lending results for 2022, the mutual’s commitment to the first-time buyer market and the ways in which its supporting brokers.
The results showed that Leeds broke all kinds of lending records last year, what are your thoughts regarding last year’s performance?
It has been our best year ever for mortgage lending. We have helped more than 18,000 first-time buyers onto the ladder.
That’s really important to us, as a mutual our purpose is about putting home ownership in reach for more people – so we were delighted.
One in three of our loans went to first-time buyers, and we punch way above our weight when it comes to that market.
We’re also the market leader for shared ownership mortgages so both of those perform very strongly.
Just to give a sense of how busy this year was, if you take our busiest lending days ever – in our whole history – nine out of ten of those days were last year.
I think part of our success is that we stayed in the market all year.
You’ll remember of course that we had the mini-Budget and all the volatility after it – and we managed to keep mortgages on sale continuously during that period.
So, I think those were some of the factors that lead to our strong performance.
The results show that first-time buyers were a key part of your performance last year, making up over a third of your business – what, in your opinion, is the market like for first-time buyers right now?
It has been more resilient than some other parts of the market, which is good to see.
But it has been very difficult to be a first-time buyer at the moment – in fact, it is the hardest time to get on the property ladder since 1875, which was the very year that we were founded.
From my perspective that is a really sad reflection of decades of inaction at the Government level to tackle to housing crisis.
So, it’s really important that the Government develop a long-term plan to provide that stability in the market, but we will play our part of supporting first-time buyers onto the ladder to the best extent we can.
What are your views of the broker market right now? And what is Leeds doing to support brokers during this difficult time period?
Brokers play such a key role in helping people navigate what is a complex market.
But, when it is a challenging time like it is now, then that role is more important than ever.
We always acknowledge that brokers are a really vital part of our success, and we always want to emphasise how much we really value our broker partners, and want to thank them for everything that they’ve done to support customers.
In terms of what we’ve done to support brokers, we’ve invested a great deal into our systems.
We have the Mortgage Hub, and that at its best, has taken application to offer times down to seconds.
We’ve provided some really strong service. We’ve invested in jobs – both in our BDM teams and our underwriting teams, and we’ve been really pleased to win some service awards this year.
But we will keep on investing in that service to support our broker partners.
Going forward what are your predictions for the remainder of the year – do you think we’ve nearly seen the end of Base Rate increases?
I think we’re approaching the peak. I think there’s probably still one or two more Base Rate increases that we’re likely to see.
As we know, mortgage rates are set by the future expectation of the Base Rate, the swap market, and those have been dropping.
You can see what a competitive market it is, rates have dropped rapidly. And I think that’s a good think, it’s a competitive, dynamic mortgage market which is going to help.
I’m optimistic about how resilient the housing market and mortgage market has been and I’m hopeful that those rates dropping back again is going to bring more people back into the market.
And finally, what’s next for Leeds? What can we expect to see from the Society over the rest of the year?
Last year made the decision to withdraw from the second homes market, which was all about focusing on our purpose of putting homeownership within reach of more people.
So, I think you’re likely to see more things aligned to our purpose, new propositions to support people to save and to support homeownership be more affordable.
We are also backing our values with actions, by extending the suspension of all our mortgage arrears fees until the beginning of next year.
We’ve not charged mortgage arrears fees since the pandemic, that’s nearly four years now.
From my perspective it is about making sure we back our words with actions that are aligned to our purpose.
