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MORTGAGE ADVICE-UK-APRIL 2018

Published By :

Mintel

Published Date : Apr 2018

Category :

Banking

No. of Pages : N/A

Consumer interest in online advice is positive, but many are unsure whether it can completely replace speaking to an adviser face-to-face. Advisers looking to launch online advice services would benefit from continuing to offer consumers choice in how they complete the advice process, such as being able to arrange a call or a face-to-face visit with an adviser.

Table of contents

OVERVIEW
What you need to know
EXECUTIVE SUMMARY
The market
Vast majority of mortgages sold on an advised basis
Figure 1: Distribution of regulated mortgage sales, advised versus non-advised, 2011/12-2016/17
Number of advised mortgage sales rises by 4%
Figure 2: Number of regulated mortgage sales, advised vs non-advised, 2014/15-2016/17
Intermediaries continue to grow in popularity
Figure 3: Distribution of regulated mortgage sales, direct versus intermediary, 2011/12-2016/17
Lending to grow by 27% by 2022
Figure 4: Forecast of gross mortgage lending, 2012-22
FCA delays investigation into the mortgage market
Companies and brands
New and existing advisers launch online advice services
Video call services help those in rural areas
Soft searches for mortgages
Lenders moving to broker only
The consumer
Majority feel confident finding advice
Figure 5: Confidence in finding and selecting appropriate mortgage advice, December 2017
Majority of direct customers go to their current account provider
Figure 6: Main source of mortgage advice, December 2017
84% are satisfied with the advice they received
Figure 7: Overall satisfaction with mortgage advice, December 2017
Additional product recommendations are the least satisfactory aspect of advice
Figure 8: ‘Any satisfied’ with different aspects of mortgage advice, December 2017
Majority do their own research before speaking to an adviser
Figure 9: Attitudes towards receiving mortgage advice, December 2017
Most mortgage holders would consider using free online advice
Figure 10: Attitudes towards online mortgage advice, December 2017
What we think
ISSUES AND INSIGHTS
Attitudes of younger generations pose a problem for advice market
The facts
The implications
Concerns about online advice will hinder uptake
The facts
The implications
Trust is key to satisfaction
The facts
The implications
THE MARKET – WHAT YOU NEED TO KNOW
Vast majority of mortgages sold on an advised basis
Lending to grow by 27% by 2022
FCA delays investigation into the mortgage market
MORTGAGE ADVICE MARKET
Vast majority of mortgages sold on an advised basis
Figure 11: Distribution of regulated mortgage sales, advised versus non-advised, 2011/12-2016/17
Number of advised mortgage sales rises by 4%
Figure 12: Number of regulated mortgage sales, advised vs non-advised, 2014/15-2016/17
Intermediaries continue to increase their share of the market
Figure 13: Distribution of regulated mortgage sales, direct versus intermediary, 2011/12-2016/17
Figure 14: Number of regulated mortgage sales, direct versus intermediary, 2014/15-2016/17
THE MORTGAGE MARKET
Growth in gross mortgage lending falls to 4%
Figure 15: Gross mortgage lending and annual percentage change, not seasonally adjusted, 2013-17
Lending to grow by 27% by 2022
Figure 16: Forecast of gross mortgage lending, 2012-22
MARKET DRIVERS
House price growth slows in 2017
Figure 17: Annual change in average UK house prices – ONS and Nationwide house price indices, Q1 2010-Q4 2017
Rate changes encourage people to seek advice
Figure 18: Monthly interest rate of UK monetary financial institutions (excluding Central Bank) for 2-year fixed-rate mortgage at 75% LTV, 2-year variable-rate mortgage at 75% LTV and standard variable-rate (SVR) mortgage, January 2008-January 2018
FCA delays investigation into the mortgage market
COMPANIES AND BRANDS – WHAT YOU NEED TO KNOW
New and existing advisers launch online advice services
Video call services help those in rural areas
Soft searches for mortgages
Lenders moving to broker only
COMPETITIVE STRATEGIES
Technology set to transform the provision of advice
New and existing advisers launch online advice services
JLM Mortgage Services
Trussle
Habito
MortgageGym
Countrywide
Nuvo
Video call services help those in rural areas
Soft searches for mortgages
Lenders moving to broker only
THE CONSUMER – WHAT YOU NEED TO KNOW
Majority feel confident finding advice
Majority of direct customers go to their current account provider
84% are satisfied with the advice they received
Majority do their own research before speaking to an adviser
Most mortgage holders would consider using free online advice
MORTGAGE OWNERSHIP & HOME-BUYING PLANS
One in four are buying their home using a mortgage
Figure 19: Housing Situation, December 2017
Home-buying expectations are optimistic
Figure 20: Home buying plans for the next two years, by current housing situation, December 2017
CONFIDENCE IN FINDING MORTGAGE ADVICE
Majority feel confident finding advice
Figure 21: Confidence in finding and selecting appropriate mortgage advice, December 2017
Renters are equally confident
Figure 22: Confidence in finding and selecting appropriate mortgage advice, by housing situation, December 2017
Confidence falls the longer people are out of the market
Figure 23: Confidence in finding and selecting appropriate mortgage advice, by timing of last mortgage arrangement, December 2017
MAIN SOURCE OF MORTGAGE ADVICE
Most people go to a bank or building society for advice
Majority of direct customers go to their current account provider
Figure 24: Main source of mortgage advice, December 2017
OVERALL SATISFACTION WITH MORTGAGE ADVICE
84% are satisfied with the advice they received
Figure 25: Overall satisfaction with mortgage advice, December 2017
SATISFACTION WITH ASPECTS OF MORTGAGE ADVICE
Additional product recommendations are the least satisfactory aspect of advice
Online advice can help those without access to an adviser
Figure 26: Satisfaction with different aspects of mortgage advice, December 2017
Main banks win on satisfaction
Figure 27: Mortgage-holders who were ‘Very satisfied’ with different aspects of the latest mortgage advice they received, December 2017
The move to online advice could affect engagement and satisfaction
Figure 28: Overall satisfaction with Mortgage Advice - key driver output, December 2017
ATTITUDES TOWARDS RECEIVING MORTGAGE ADVICE
Majority do their own research before speaking to an adviser
Figure 29: Attitudes towards receiving mortgage advice, December 2017
Online submissions can simplify the application process
Lack of trust means people want to feel prepared
Figure 30: Attitudes towards receiving mortgage advice, December 2017
Can online information really replace advice?
Figure 31: Attitudes towards receiving mortgage advice, by age, December 2017
ATTITUDES TOWARDS ONLINE MORTGAGE ADVICE
Most mortgage holders would use free online advice…
… but making the transition easy will be key to uptake
Figure 32: Attitudes towards online mortgage advice, December 2017
Online advice is more convenient
More recent customers more likely to consider online advice
Figure 33: Attitudes towards online mortgage advice, by timing of last mortgage arranged, December 2017
APPENDIX – DATA SOURCES, ABBREVIATIONS AND SUPPORTING INFORMATION
Abbreviations
Consumer research methodology

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