With numerous changes being implemented in response to the pandemic, including Stamp Duty Holidays, Land and Buildings Transaction Tax and Land Transaction Tax, taken together with the fact that many now have different property preferences, the residential property sector has gathered momentum since it was allowed to reopen in May 2020.
The statistics support this, with UK residential transactions in March 2021 doubling compared to March 2020, and sitting 32% higher than the previous month, according to the latest UK monthly property transactions.
Given this extension of the Stamp Duty holiday, it is perhaps unsurprising that the current market frenzy is expected to continue into a ‘summer boom’, with recent statistics from TwentyCi’s Property and Homeowner Report confirming just that.
Challenges from the boom
While this is positive, it has left many involved in the residential property market struggling to cope with borrower demand. According to TwentyCi’s statistics, there are difficulties in keeping housing stock levels high enough to meet buyer demand, and available stock numbers are down by about half on historical norms.
This increase in activity will be putting pressure on all within the property chain - estate agents, brokers, lenders, conveyancers - and could even be increasing levels of stress for borrowers who are dealing with an increasingly competitive market.
With that in mind, the need to streamline the property industry and mortgage process into a journey that is easier for everyone is greater than ever - and the key to this is digitalisation.
Digitalising the property market
The mortgage market has been accused of being slow to implement technology, but digital automation and improvements were rapidly adopted as the impact of the pandemic spread last
year. While these were largely forced upon keeping the industry open, they brought benefits which many now want to keep – for example, allowing brokers to reduce the capacity spent on time-consuming admin tasks, leaving them with more time to progress applications.
As well as online communication, advisors enjoyed introducing digital application tracking, interactive calculators and online fact finds to their list of services. Smartr365 even went one step further by introducing various integrations, including real-time mortgage DIP submissions with Halifax Intermediaries. The boost to efficiency that these features like automated DIPs provide is also becoming increasingly crucial to advisors, with complex products like furlough-friendly mortgages, on the rise.
Ultimately, any digitalisation that has streamlined processes and takes time-consuming tasks away from brokers, such as managing lead flow, is a positive addition and will free advisors up to deal with the higher levels of demand that they are currently experiencing.
Additionally, the strong digital support system has a positive impact on retention rates, with brokers that use the Smartr365 platform being 2.5 times more likely to retain business when compared with rival brokers, enjoying 85% retention against an industry average of just 30%, for example.
Benefits for borrowers
However, it is not just those in the property industry that are benefiting from digitalisation – borrowers clearly benefit from a smoother process too. In particular, Smartr365 has also tried to further reduce the lengthy process of buying a property by launching the industry-first HomeBuyer app in March this year. This app allows customers to scan a QR code or Near-Field Communication (NFC) chip, in an estate agent window or on a property search site, before automatically and remotely sharing their details with a mortgage broker to begin the application process.
Once the application process has started, every step can be completed remotely, online, at whatever time of day or night suits the customer. For example, instead of the old ID verification process which would involve physical presence and photocopies, all a borrower now needs is a selfie and a picture of their passport or driving license. This can be done from the HomeBuyer app, via Smartr365’s integration with Digidentity, the market’s premium leading digital ID verification service.
Additionally, borrowers can also input their bank account details and give authorisation a bank to access their financial information and carry out a credit check in the blink of an eye. This saves time
on both sides of the process, with no need for any re-keying of data, ensuring a pain-free credit checking service.
Such developments cut inefficiencies for broker, buyer, and lender, meaning that it has never been easier to buy a house from home and exemplifying why digitalisation is so key for the property market.
Future opportunities
Those who took the opportunity to start their digitalisation journey in the last year have already reaped rewards – and yet 2021 is a year of further opportunity. Thousands of 2- and 5-year fixed-rate mortgages are set to mature in 2021, with some reports suggesting that this figure could be as high as 700,000. The circumstances of these borrowers may well have changed significantly since they began their purchase journey many years ago, meaning that many will be looking for fresh advice around their next mortgage.
Digital tools not only seamlessly connect brokers to this growing number of borrowers but also cut inefficiencies once these relationships have been formed. Smartr365’s HomeBuyer app and integration with Microsoft to bring audio and video calls to the end-to-end platform ensure that all parties remain effortlessly connected and supported throughout the mortgage journey – something that will be particularly crucial this year.
Continuing apace
With significant strides being taken to digitalise the property industry in the last year, the industry should celebrate its success – after all, it survived a difficult year. However, it is important that we build on this momentum and continue our work to transform the industry’s presence in the online world, with many further benefits potentially yet to be discovered. It is only by continuing to digitalise that we will collectively reap the rewards and offer borrowers the highest level of customer service at a critically busy point in time.
