View more on these topics

Malone claims profit slump shows need to focus on FTS

The tumbling profits of estate agents and housebuilders are a warning that the mortgage industry should change the way it targets the market, according to Premier Mortgage Management managing director John Malone.

Amid profit warnings from Countrywide, one of the UK’s biggest estate agents, and mortgage broker Compass Finance, Malone warns that the market should stop concentrating on churning and change its target consumers.

Countrywide, which owns estate agency chains Bairs- tow Eves, John D Wood and Mann & Co, says it will make a loss for the first quarter of the year, with transactions down by 25-30 per cent on the same period last year.

Chairman Christopher Spor- borg says Easter is usually a very good time for transactions but this year there have been considerably fewer transactions than expected.

Countrywide says the lack of proporty sales has also meant fewer sales of accompanying financial products.

Compass Finance issued its second profit warning in the last two months, citing its over-expansion within a slowing mortgage market. It has inv-ested 740,000 in expanding its infrastructure since 2002 but has cut operating costs by 170,000.

Housebuilders are also feeling the effects of the market slowdown, with Wilson Bowden housebuilders cutting around 70 jobs since last September.

Malone says he has been in talks with lenders on changing their focus from remortgaging and the first-time buyer market to first-time sellers.

He says he has had optimistic feedback on the idea from lenders, including Halifax and Abbey.

Malone says: “Surely, the slowdown and the problems faced by estate agencies is telling lenders to take ano- ther look at how they are targeting the mortgage market. This obsession with churning has to stop, otherwise there could be some very difficult times out there.”

Recommended

S&P launches tool for assessing risk of sponsor default

Standard & Poors is launching a tool to help pension fund trustees to carry out a risk assessment of their pension funds sponsoring company. From next April, under draft guidance issued by the pensions regulator, trustees will have to decide whether there are sufficient funds in the defined pensions schemes, many of which still have […]

FSA set for FSCS rethink

The FSA is understood to be looking at restructuring funding blocks for FSCS fees following criticism that some sectors have been paying too much.

‘Leave IT to the experts’

Technology has become too complex for IFAs and they should leave it to specialist firms, Positive Solutions marketing manager Daniel Harrison told delegates at Money Marketing Live.

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment

    Close

    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm

    Email: customerservices@moneymarketing.com