Can you provide an update on Aberdein Considine’s broker business?
Greig Brown: We have 17 mortgage and protection advisors at Aberdein Considine and cover 16 offices in Scotland. We are a traditional face-to-face business model where our clients will come in and see us and sit down in the mortgage advisors’ office and we will give them advice on their mortgage and protection needs. Over the last couple of years, we have adapted and changed so that we also offer a video call service as well as over the telephone at a convenient time for them. It has been a time when we’ve had to adapt like all businesses and all industries, but we are quite proud of the fact that we have grown significantly in terms of the team size by 36% over the last 18 months.
We’ve got quite a strong business model, and not only managed to retain staff but also grow and increase the volume of mortgages we’re doing in the number of people that we are helping. We have also invested a lot into our admin team and brought new people in there to provide the best customer experience as lenders have felt the pinch with staffing issues and Covid impact. It’s important that we look after all clients so we have developed and increased the headcount in our administration team to support the customer experience. We have also invested a lot in our people through training and the introduction of our online training hub where people can do self-development at home or during working hours, we have also brought in an aspiring advisor programme for people who are not mortgage advisors but aspire to be. We will support them with exams alongside our development plan and mentor plan to go from whatever role to a mortgage advisor role. We really look at developing our own advisors for the future from within the firm already.
We have also invested heavily in technology, to see how we can really become the front runner for tech within the mortgage industry in Scotland. We have looked at a completely paperless digital model, which clients will be able to utilise if they want to. We will still have our traditional ways available for clients to do business with us, but that’s something that we are implementing now.
Lastly, we’re going to be looking at developing our brand around Aberdeen Considine and specifically AC Mortgages. We are looking at getting out into the market and growing the awareness and brand around mortgages within the firm.
What are the motivations behind rebranding the broker business as its own entity?
Darren Polson: We are already well known in Scotland for our estate agency and legal services, but we want to be as well known and as competitive for mortgages. AC Mortgages is going to be our brand name and our identity that we’re going to focus on. We want to be more client-focused so we’re looking to develop our social media platforms, our website and the way that clients can interact with us. One of the key things we’re looking to do, which aims to set us apart from a lot of our competition, is to be educational. We want to educate clients on various different parts of the process, on market conditions, what’s going on at the moment, but also other things that people don’t think about such as protection and home insurance, and all the things that will come up in the life of a mortgage. If clients interact with that message that we’re sending out, then ultimately they will come to us for a mortgage because they will engage with our content.
But the flip side to that is to make it easy for clients to interact with us through either social media websites or through our new landing page that we are going to create that will make it easy for clients to fill in details and come to us for a mortgage.
The other focus is on Google searches. Clients will always search online, with ‘mortgage calculator’ or ‘how much can I borrow?’ being within the top searches. We are going to include these on our website front and centre, which we are hoping will push the company up in the Google rankings as well.
The rebrand isn’t to separate us from the legal and agency side because we’re proud of that brand and the awareness that has in Scotland, but we also want to be out there in the market amongst the big players on the mortgage side.
When is the rebrand planned to launch?
Darren Polson: All the work is currently going on such as rebuilding the websites and social media accounts but we would like to have it up and running in the next couple of months. Realistically our launch date will be 1 August but if we can get out into the market sooner we will.
As its own entity, what are your future plans for the mortgage broker business?
Darren Polson: For us right now, we are very much on a journey and it’s a continuation of that. I think the biggest thing for us is to invest in our people. The admin team we’ve got the advisors, and telephone consultants, making sure that they are happy, engaged and loyal, and ultimately that will allow us to reach our aim of becoming the best mortgage broker in Scotland. We don’t necessarily want to be the biggest in terms of the number of advisers but it’s about being known for adding value to the Scottish mortgage market and one that people trust and recommend to others in terms of reviews.
Beyond that, we want to set ourselves up for growth to further expand geographically and there’s no reason why we can’t branch out beyond the borders of Scotland to support people in England.
We are looking to deliver the best possible service and retain our existing clients because they are the lifeblood of the company. We also want our existing customers to recommend us to others while also attracting others through outstanding service.
In addition, leading the market in terms of technology, that’s something that the last couple of years has taught us and has forced people into different forms of communication, such as Zoom and other online platforms that they wouldn’t have previously used. Technology has allowed us to work and engage with those people who would rather have a phone conversation, a video call or a discussion via social media platforms. While we will continue to work that way, we will always welcome the people who want a face to face appointment at one of our branches.
What trends are you currently seeing in the Scottish housing market? And how are these impacting the market?
Greig Brown: There are a lot of things going on in the market right now but one of the most prominent things is the change in rates. After being stagnant for quite a long time, the Bank of England’s recent base rate rises have had an impact on the market, alongside other factors such as the cost of living crisis, fuel prices and cost of food.
We’re seeing a lot of movement from clients that are looking to fix their mortgage so that the cost of their mortgage, which is quite a significant cost, is static while everything else continues to rise. We’re seeing people fix their rates and for a longer-term such as five- or 10-year fixed products.
We’re also seeing the demand significantly outstrip supply, which has created a lot of challenges for people. This is the case for first-time buyers who require higher deposits or more money to offer over the asking price. This is geographical in terms of sensitivity, for example, Edinburgh and Glasgow are much more competitive in terms of prices compared to Aberdeen. However, we are now seeing places like Aberdeen starting to go into offers over the asking price situation. There is a lack of stock coming on to the market, fewer people selling but more people looking to buy, which has continued to drive prices higher making it a challenging market.
Darren Polson: Recently, we have seen a demand for additional borrowing. A lot of clients are looking to revamp their current homes if they are not able to move. This means we have seen an increase in home improvements in the garden, garage, loft conversions, etc. Over the last couple of years, people have worked from home and they are starting to see things in their house that they didn’t notice before causing them to either do home improvements or move house. For example, people that live in a flat are looking to buy a house so they’ve got some outside space. It has become difficult for first-time buyers but at the same time, those people who had flats are potentially moving into houses, making flats available for first-time buyers. There is a natural circular motion happening and it seems to be a common trend at the moment.
How do you expect this to change in the next few months?
Darren Polson: What we often say is look to the future as what’s already happened in the past. If we look back to Covid, a lot of government predictions and a lot of the sceptics were saying that the property market would slow down and house prices would become stagnant but it was the opposite. A lot of people during Covid moved, lenders’ rates were good despite the previous interest rate rise, first-time buyers were still getting on the market and newbuilds were still happening. Therefore, it is difficult to predict.
However, what I would say is that demand will still be there. So if people are looking to sell their house, there will still be buyers despite the cost of living increases. It will definitely squeeze things a little bit tighter, so it’s going to be more affordability focus from a lender’s perspective due to the rise in rates and cost of living.
Do you think there will be a peak in terms of house prices soon or do you think they will continue to rise?
Darren Polson: That’s what everyone wants to know. I think that the peak is always driven by the market. It’s always the same if the supply and demand are there, then people will always buy the houses, but what we’ve seen recently is not necessarily a peak, but certainly a levelling off. Geography comes into that massively, Edinburgh overtook London last year in terms of the average offers over house price, which is huge because that has never been the case. There are a lot of houses that are still buying on the home report value that the houses are being sold for, they are not going for much over that value.
Greig Brown: A lot of people predicted that it had already peaked. Last year the prices continued to rise, particularly post-pandemic when people were able to move again, there was a lot of appetite. A lot of people thought it would slow down but it has continued and has continued longer than it was once predicted. There must be a peak at some point but I can’t see it happening anytime soon.