SHCS Corporate Newsletter Winter Edition 2021

corporate sales

Corporate Newsletter

January 2021

Fight or flight.

Our lockdown story.

It’s the 16 March 2020 and the UK is preparing for its biggest challenge in over 70 years.

The covid-19 pandemic is spreading rapidly throughout the country and businesses are in fight or flight mode.

At Spicerhaart, we evoked our business continuity plan (BCP) on the 16 March 2020. Within the next 2 weeks we had cast it aside. We’ve always tested our BCP annually and included the possibility of a pandemic as one of our scenarios. Yet we didn’t anticipate 100% of our The history of Spicerhaart workforce would be required to work remotely.

During the days leading up to the nationwide lockdown we 1995 — 72 Cornerstone branches acquired worked tirelessly to seamlessly 1998 — Felicity J Lord launched 1999 — 173 Woolwich Property Services team branches acquired transition our entire to 2000 — 47 Darlows branches acquired remote working without 2001 — Legal Services compromising our high 2003 — Corporate Sales 2006 — Spicer McColl, FJL re-brand, Buzz standards of customer service.

1989 — Spicerhaart founded 1990 — Mortgages Direct

Find out more about how one of our team members adapted to remote working by reading her interview on page 8.

CORPORATE SALES BE TRANSFORMED. INTELLIGENT ASSET MANAGEMENT.

Welcome to our winter edition of the Spicerhaart Corporate Sales newsletter

What an extraordinary year 2020 was!

As the UK entered its first lockdown in March, who’d have thought we’d still be under restrictions now, and that Christmas celebrations would be so different to any enjoyed before.

So, as we bid farewell to 2020 we’ve taken the opportunity to summarise the changes we made to our business over the year. We also introduce you to some of the services and divisions across the Spicerhaart group.

We couldn’t have achieved a smooth transition without embracing technology. Using our existing tech alongside www.spicerhaart.co.uk/corporatesales new desktop phones and range extenders, we were able to optimise our customer and We hope you enjoy this issue! employee experience. We were assisted by our exceptional IT team who went above and 2007 — HIPs.co.uk, Valunation, haart re-brand, Haybrook acquired Steve Lamb, our CIO said: beyond toSold,ensure ouracquired business 2008 — Must be Calnea, Dedman 2009 — Chainfree.com continued as normal, and we “Our operational and IT teams 2010 — Land & New Homes expanded, Exclusively Surrey acquired, Printers, New Head Office, New Chairman definitely achieved this. worked so well together to 2011 — Croydon, Leatherhead, Islington, Stoke Newington, Bedminster and Winchester, Prime2

Continued onMortgages, pageHorsham 2 Ashford (Kent) 2012 — New haart, Just

2013 — Felicity J Lord re-launch and Chewton Rose launched

deliver a quick and effective transition to home working with many going above and beyond to implement the shift to remote working quite literally overnight.

Whether the Service Desk or Developers, everyone pulled together exceptionally which was an enabling factor in the success. Having a business lead co-ordinate the response and manage local teams simplified the communication lines and effectiveness of implementation, as per the BCP.”

Continued from page 1 One of the biggest challenges we faced was making sure that we were supporting the wellbeing of our employees.

And what we found was that everyone came together to support each other. Our clients were also very proactive and worked to support us too. It was humbling to see everyone come together to achieve a common goal.

The fact that our people felt comfortable and looked after meant they were able to provide our clients with exceptional service and improve performance.

During the first lockdown, we passed a number of audits with flying colours and we continued to manage and sell even the most complex properties we were instructed on. Our team’s commitment has been exceptional during

the pandemic and they’ve continued delivering the best possible results for our clients.

to achieve some outstanding results on both private treaty sales and also online auctions.

Excellent communication remains one of the key elements of our service. A month before lockdown 1.0, we started communicating with our suppliers and clients about our plans and how we were aiming to support them during the pandemic. We continued with this throughout the year and regularly scheduled email updates and follow up calls keeping everyone in the loop.

We’ve been able to maintain business as usual and there’s been no downtime in service because of our committed employees and use of technology. So, whilst our story’s been a positive one, we’re fully aware that the pandemic has impacted individuals and businesses across the country. We send our best wishes and sincerely hope 2021 brings about a change of circumstance.

It’s been wonderful seeing how some businesses have been able to switch their ways of working and adapt to the pandemic. We too, have altered the way we work and now market our properties by offering virtual tours and online viewings. This has allowed us

Corporate portfolio rental services for financial institutions Our specialist lettings service serves corporate landlords and financial institutions with complex portfolios and specific needs. The division is supported by our nationwide branch network that’s home to our highly trained and locally connected branch managers.

Introducing Kate Hurles, head of landlord investments — she’s shared her thoughts on how the services her team offer adapts to financial institutions.

We asked Kate a few questions: What challenges are corporate landlords facing?

“Property management is such a specialist area. Securing the right rental amount and finding a reliable tenant is challenging.

Plus, rents are rising in some regions. In other regions,

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property value increases are presenting a perfect opportunity to sell an asset and re-invest elsewhere, and that’s a challenge because it’s a decision that’s not to be taken lightly.”

How can your team help?

“We provide a single point of contact for managing portfolios as an investment as well as on a practical, day to day level. We recognise that each asset is a home; tenants have individual rights and needs and at the same time, the asset needs to work hard within the portfolio.

“Optimising the portfolio comes from understanding how the assets are performing, whilst recognising those which can be improved.”

“As a team, we have the local knowledge and local presence, and we use this to gain a full view of the portfolio for our clients.”

How do financial institutions benefit from your team’s expertise?

“Some financial organisations operate a portfolio as part of their investments, and just as we do for portfolio landlords, we can help optimise the asset, whilst following the evercomplex rules of the private rental sector.”

With decades of experience in lettings, whilst maintaining a firm focus on the needs of the corporate investor, Kate and the investor services team can help with unusual or challenging let portfolio investments.

To speak to a member of the investor services team call Kate Hurles 07960 120267 kate.hurles@spicerhaart.co.uk

2020 in numbers Last year was an extraordinary year in so many ways. Mortgage holidays and a ban on banks carrying out repossessions hid the extent of the financial difficulties experienced by some. Meanwhile, as hospitality and leisure businesses were forced to close for much of the year, this will have led to significant financial pressures for many – whilst others have seen their savings grow.

Below are five of the most interesting charts and statistics of the year:

Mortgage possessions 2500

Number

2000

Q3 2020

1500

Homeowners - 160

1000

Buy to Let - 230

500 0

17-Q3

18-Q1

18-Q3

19-Q1

19-Q3

20-Q1

20-Q3

Source: UK Finance, November 2020

Outstanding credit card balances

Credit card debt

-16.4% - change in outstanding credit card balances in year to October 2020.

£2,177 - average credit card debt per household October in 2020.

Source: The Money Charity, December 2020

Source: The Money Charity, December 2020

Mortgage arrears 120000

Number

100000 80000

Q3 2020

60000

Homeowners - 74,850

40000

Buy to Let - 5,400

20000 0

17-Q3

18-Q1

18-Q3

19-Q1

19-Q3

20-Q1

20-Q3

Source: UK Finance, November 2020

Unsecured debt £3,879 - total unsecured debt per UK adult in October 2020.

Source: The Money Charity, December 2020

corporate sales

Pillings Predictions

With the UK propped up on financial support, will we fall or stand strong in 2021?

No-one could have predicted how 2020 would develop, and so, as we enter 2021, it’s impossible to predict just what will happen over the next 12 months.

Impossible prediction number one: Until the 30th April, we expect that not much will change; that’s because the government’s Job Retention Scheme currently masks the impact of the pandemic on jobs. It’s impossible to predict the full repercussions. Many are concerned that the scheme has been hiding a redundancy time-bomb, with thousands of employees still being paid by businesses that will not be able to survive, or will need to cut back.

Impossible prediction number two: Last March, the government announced the introduction of mortgage holidays. According to UK Finance, as at 31st October 2020, 2.6 million mortgages holidays had been requested.

Based on the FCA’s guidance, there are primarily three scenarios:

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• The borrower returns to work and can afford the mortgage payment. The borrower will only have to agree with the lender a repayment plan taking into account the frozen payments due during the mortgage holiday period via a higher repayment or a longer loan maturity. Experience tells us that this is the preferred scenario for lenders and results in less adverse credit impact on transactions.

Impossible prediction number four: We’re all hoping that life starts returning to some form of normality by early summer. As people keep searching for jobs or, if they’re lucky, continue working in their current roles, when will we start to see the impact of the furlough scheme?

Will it be harder to achieve a mortgage as the banks exercise increased stress tests?

• The borrower can only pay a percentage of the previous mortgage repayment. In this case, the borrower will have a detailed discussion with their lender or mortgage servicer and they will undertake a detailed review and consider the options available.

So, in terms of how 2021 will pan out, it’s likely that Q1 is going to be much of the same of what we’ve seen in the second half of 2020.

• The borrower still can’t afford the repayments. The lender will then have to consider what formal action is required including litigation.

Can the courts and bailiffs cope with the demand?

The good news is that it appears a large proportion of borrowers have returned to normal payments. The borrowers who were in difficulty prior to covid will face a number of other challenges and rely on the support and assistance of their lender as we move through 2021.

Impossible prediction number three: Politics. Whilst the UK and EU secured a last minute Brexit deal, the impact of the deal on businesses is still unknown, as exporters and importers remain unclear about how much additional customs paperwork may be required.

We expect Q2 to be a challenging quarter.

Will repossessions increase?

What happens when the stamp duty holiday ends, will house prices fall?

Will we see negative interest rates?

How high will unemployment rise?

At the moment, we don’t know how any of these factors will impact the housing market.

When it comes to 2021, the only sure thing is uncertainty.

Mark Pilling is Managing Director for Spicerhaart Corporate Sales.

Just Mortgages As we embark on a new year, our colleagues at Just Mortgages reflect on a successful 2020.

The mortgage broking arm of Spicerhaart has arranged in the region of £3.3 billion worth of mortgages in 2020, from across its network of 500 financial advisors across the UK. We’re growing, and we owe that, in part, to the Just Mortgages academy. We’re dedicating time to nurturing our own talent and we’re on target to employ 1,000 financial advisors by 2024. We use our academy to develop a number of advisors a year and support them to increase their financial knowledge and customer relationship skills; as well as welcoming experienced advisors into the team.

By investing in our people, we guide them on a journey towards success and to ultimately receive customer praise such as this from customer Laura Parry - “Richard was superb and my husband and I are so grateful for the help and support we received from him. I highly recommend him and we feel that he should be recognised and awarded for all of his hard work. Many thanks, Richard, for helping us get the house of our dreams.”

This comment highlights what all of our financial advisors set out to achieve and that’s to build relationships and create trust with clients. Our growing team work hard to get to know their

customers and always act in their best interests.

With more than 500 financial advisors located both remotely and within our estate agency branches across the UK, our team have been using their local knowledge to support our clients throughout 2020 and we’ll continue to do this into 2021 and beyond.

So, what’s in store for Just Mortgages next year?

The stamp duty holiday helped keep the market buoyant.

However, when this scheme finishes in March, there’ll be many people still wanting to review their mortgage arrangements due to their fixedrate coming to an end.

We’re expecting there to be some challenges for those who’ve been impacted by the pandemic, and we’ll be there to offer advice and a helping hand if their mortgage arrangements are no longer suitable.

So regardless of the uncertainties of 2021, we’re sure that the customer relationships we’re building and truly value plus the active support we give them will make sure that it’s a positive year and provide us with the foundations we need to achieve our growth expectations.

Having Just Mortgages as part of the Spicerhaart group means we have lender support at multiple touchpoints across the business, offering exceptional support to our mutual clients.

“”

We also have to consider buy-to-let landlords who may need to re-assess their portfolio. For many landlords, buy-to-let remains a positive experience, and some will be looking to expand their portfolio, particularly in advance of the stamp duty holiday which can save them up to £15,000.

2021 will also see Just Mortgages launching a wealth advice service; offering advice across pensions and investments or equity release.

Our well-placed network of advisors is in a great position to advise customers on their financial assets and lifestyle choices, preparing them for a comfortable future.

We arranged £3.3 billion worth of mortgages in 2020.

corporate sales

Launching ‘Must Be Sold by Auction’ in 2021 We’ve been busy preparing for the launch of our new in-house auction service – Must Be Sold

by Auction. Launching early this year, we’re teaming up with SDL Auctions and we’re confident that our partnership will take this new offering from strength to strength.

It’s been a natural progression to get to this point. We’ve always outsourced our auction service for clients. Now we’re seeing an increase in demand for buying and selling properties via auction and it’s the right time to expand the flexibility and opportunities for property disposal throughout the UK. Our ultimate aim is to make our client’s businesses more successful by streamlining the auction process Our corporate sales, quick purchase and investor clients will benefit from: • A knowledgeable and proactive team that understand the history of each auction property.

Our unique, fully outsourced service combines an assessment of each property and pro-active management once instructed to sell the property to achieve the best price.

We’ll be offering: • Timed auctions: Our online auctions will be running 24/7 and will attract a worldwide audience of potential buyers.

• Auction events: Our livestreamed auctions will be held regularly by our experienced auctioneers.

• Seamless management of all properties going through the auction process.

• Types of sale: We offer unconditional and conditional methods of sale, providing choice and control on the exchange of contracts and completion dates.

• The high standard of service that Spicerhaart clients are accustomed to.

The pandemic has had a significant impact on the auction market. Not only will

houses and flats be auctioned via Must Be Sold by auction, but we’ll also be listing commercial properties. It’s a sign of the times that there will be an increase in the latter being listed. Our experienced Commercial Team will manage these properties to ensure that any opportunity to enhance value is considered prior to the property being offered for sale.

We want Must Be Sold By Auction to be one of many Spicerhaart 2021 success stories. We’ll update you on our progress.

Must be Sold

BY AUCTION

corporate sales

Growing concern over interest-only mortgages In January 2018, a review on The Fair Treatment of InterestOnly Borrowers was published by the FCA. The review revealed there were several issues and discrepancies in terms of how lenders were treating borrowers with existing interest-only mortgages who may have a repayment shortfall at maturity.

The main areas of concern were the different ways lenders were contacting these borrowers and the lack of reciprocal contact.

So, how far has the market come since 2018?

In June 2019, UK Finance reported that 1.02 million interest-only mortgages were outstanding in the UK. At this point there were 54,000 mortgages due to expire in 2020 and thereafter, 513,000 are due to expire between 2021 and 2027. Obviously since these figures were produced we’ve faced a global pandemic that has left lenders offering a broad spectrum of forbearance to borrowers, including those whose mortgage is due to, or has expired.

As many more interest-only mortgages reach maturity, Spicerhaart has developed a unique solution to support both lenders and also most importantly borrowers where they have an interest only mortgage. As a lender or mortgage servicer, you need the loan repaid yet for many of your customers it’s just not that easy to access these funds.

In many cases, those 1.02m borrowers do have a plan in place to repay the loan in full.

Yet, there will be a significant portion who are facing a shortfall and some who have no strategy to repay their interest-only mortgage at the end of the term.

This situation has worsened due to the impact that coronavirus has had on people’s finances and health.

For lenders and borrowers, despite a growing need to resolve this problem, the issue just isn’t going away.

The biggest fear for the affected borrowers is that they’ve never been in this position before, and they believe their options are slim. What they don’t realise is that there are solutions available if only they would seek help.

And for you, the lender, we know that you want to handle the whole process effectively and with empathy. This is why we’ve teamed up with legal experts TLT to work together to help you resolve these situations in the most amicable way possible.

We are able to arrange a field visit with the borrower to discuss their options. We ensure that these visits and conversations comply with regulations. We are able to present a number of different

solutions to the borrower and provide advice and signposting on each of these. Most of these solutions involve repayment of the outstanding mortgage through refinance, sale or conversion to a new loan.

We also support the borrower if they need to sell the property and move into rented accommodation or downsize.

Spicerhaart can help the borrower achieve the best price and assist them in finding alternative accommodation.

Where there is no other solution, litigation begins.

Throughout the whole process, TLT will ensure the process is legal, fair and delivers the best outcome.

By joining forces we’ve created a unique and comprehensive solution for lenders. Our primary goal has been to work with our clients to support interest-only borrowers who are facing a challenging time. A mortgage coming to maturity with no plan in place is a daunting prospect at the best of times, let alone as we start to come out of a pandemic and the potential financial challenges that the future may bring.

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Our people — at the (Spicer) haart of the business

Our employees are committed to providing you, our clients, with exceptional service. Their dedication to delivering the best outcome for our business and yours has been more apparent than ever.

We’d like you to get to know them better.

Introducing Helena Hudson, Property Consultant for Spicerhaart Corporate Sales.

We discussed Helena’s role and her 2020 Spicerhaart experience.

Tell us about your role at Spicerhaart.

I’ve worked for the business for two years, and I look after properties in the south of England.

In a nutshell, within my area of Corporate Sales, I manage the relationship between banks/ building societies and estate agents. As a collective, we process the sale of repossessed properties.

What are the most rewarding and challenging parts of your job?

lockdown 3.0, with no sign of a return to the office, it’s great that we can rely on technology.

Because of what I do, it’s difficult for me to divide the rewards and challenges into two pots. For example, working with repossessed properties means that someone has ultimately lost their house. That’s not a pleasant experience for anyone.

I’m always empathetic towards the property owner.

Has the market had an impact on your role?

I nurture relationships with estate agents, so I’m able to quickly identify those with the best credentials to sell a property. I ultimately want to get the best outcome for everyone involved. When that happens, then I get a sense of satisfaction that I have helped someone.

How have you coped during lockdown?

Well, I began working from home on the 23rd March. I enjoy it. There are fewer distractions and I can easily stay focussed.

Plus, the flexibility and lack of commute is a bonus.

In March, the government stopped all repossessions from taking place. Because the courts were closed and bailiffs weren’t active, new activity has reduced. The ban on enforcement action ceases on 31st January and because of a notice period, we probably won’t see movement in this area until at least the end of February.

My focus is on selling existing properties using both virtual and actual viewings.

Head to page 4 for our 2021 impossible market predictions.

I do miss social interaction, but I can’t complain. The equipment we’re using means that the pandemic hasn’t impacted my ability to stay in touch with clients and colleagues. It’s been a seamless transition. Now that the country has moved into

If you are interested in talking to us about any of the services we can offer our corporate clients, please do get in touch.

Spicerhaart Corporate Sales 5 Skyways Commercial Centre Blackpool Business Park Amy Johnson Way, Blackpool FY4 3RS Main Reception: 01253 603000 Fax: 01253 603031 E: CorporateSales@spicerhaart.co.uk

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