The Changing Motivations of Clients

Buying a home remains as popular an ambition as ever for many reasons.

In fact, research by Yorkshire Building Society shows that over half of aspiring buyers are keen to get on the housing ladder as they feel they’re wasting money on rent.

Meanwhile, almost one in three would like to renovate and create a place to call home, while nearly two-fifths are interested in buying as an investment.

But, for many, hopes of purchasing a property have been blocked by factors such as prohibitively high house prices, interest rates moving to a 15-year high, and the soaring cost of living.

As a result, nearly four-fifths of first-time buyers and almost three quarters of remortgagers now feel home ownership is becoming an elite privilege.

Meanwhile, almost two-thirds of landlords believe the rental is becoming less attractive, with 58 per cent feeling as if the government is pushing them out of the market.

So what does this mean for brokers?

Well, aspiring buyers certainly recognise the need to get professional advice in this current climate.

According to the YBS research, 81 per cent of first-time buyers expect to use a broker when purchasing a property, as do 68 per cent of those who are remortgaging.

That’s a clear reflection of how people have become increasingly aware that navigating the mortgage and home buying market is becoming more and more complex, and that a wider range of options are available to them.

Brokers therefore need to make sure they are adding genuine value to each and every client, by asking the right questions, giving clients the information they need to know and assuring them that you understand the challenges they face to afford a mortgage.

For example, if clients are citing cost of living pressures as the reason for struggling to buy a property, could you educate them on issues such as budget planning and how to reduce their outgoings?

Of course, this is a hugely sensitive topic, so it’s really important to tread carefully when advising clients, and show empathy and emotional intelligence as you guide them through what changes they can make.

If you can do this and do it well, your client will be more likely to follow your advice and achieve their desired outcome, as well as value the service you provide and trust your recommendations.

Ben Merritt, Director of Mortgages at YBS, comments: “As the housing market transforms, we will continue to innovate, show flexibility and support brokers, who have a vital role to play in advising and guiding borrowers during such challenging times.”

Learn more: How To Support Vulnerable Clients

Clients approaching with more complex needs

In order to provide a meaningful and relevant service, brokers must also recognise that the nature of how we live and work has changed dramatically in recent years, so what might have been good advice in, say, 2019, might not be suitable today.

For example, more people are choosing to work for themselves or are employed as contractors, and therefore don’t have a regular, guaranteed, salaried income.

Meanwhile, a growing number of people are choosing to work from home, and want a property that’s suitable for both their family and professional life. For many, that will mean a house with a spare room that can be used as a home office, and a space that they can shut the door on at the end of their working day.

The family arrangements of people living in residential properties have also evolved over the years.

For instance, multi-generational living has become far more common, partly because many adult children are still living with their parents, or adults are caring for older relatives at home to avoid incurring high care costs.

At the same time, we’re seeing more blended families, containing a couple alongside children from one or both of their previous relationships.

The common thread here is that many families are pooling their resources to create a suitable living space for everyone - and are therefore seeking a mortgage that is suitable for their unique situations.

Alongside all these domestic matters, we’re seeing changes in buy-to-let regulations prompting many landlords to review their portfolios and their overall finances. As a result, they’re also seeking ever-more complex guidance and support from brokers.

Jeremy Duncombe, Managing Director of Accord Mortgages, says: “There is no doubt that many landlords will need to professionalise their provision. Most importantly, they need clarity on regulation. They need to know exactly what is required of them and when they need to act.”

Mortgage brokers must be able to respond effectively to everyone who presents with highly specific and individual needs and circumstances, and point them towards mortgage options that are appropriate for them.

By understanding their unique situations and tailoring advice to each client, you’ll provide a much more valuable service, and ideally build a much stronger and more positive relationship.

Learn more: The Brokers' Guide To Customer Experience