Angus Stewart, founder & Chief Exec of Property Master will be speaking at FinTech Connect Live! at ExCel London on December 7 as part of a panel convened to discuss the future of the mortgage market in the light of regulatory changes brought about by Open Banking and technological advances such as Blockchain.
The advent of Open Banking, the next phase of which rolls out in January 2018, threatens to unbundle the mortgage market potentially turning existing lenders into commodities and leaving behind swathes of traditional mortgage brokers. Whilst Open Banking offers the potential to disrupt the entire banking market it may well be in the increasingly professionalised world of the private landlord that the effects are felt first, according to Property Master, the UK’s first digital buy-to- let mortgage broker.
Angus Stewart, Chief Executive, Property Master, said: “By forcing banks to lift the veil on their customers’ transaction data Open Banking will facilitate the creation of exchanges that will bring together buyers and sellers in the world of finance. In the market in which we operate I can foresee a time when the data about individual landlords’ portfolios together with their credit history is packaged in such a way by companies such as ourselves that individual lenders will be forced to bid for a landlord’s mortgage business so pushing those lenders into the position of being a commodity item.”
Mr Stewart believes there are good reasons why private landlords may well be early adopters of such technological change. “The private rental market itself is undergoing a transformation as landlords adapt to a range of regulatory changes and now rising interest rates. Taken together these trends are bringing about a greater professionalisation amongst landlords and an appetite for faster, cheaper funding solutions. To date private landlords have been served by a fragmented marketplace of more than 12,000 traditional brokers typically offering access to a limited panel of lenders. Such brokers have a high cost of doing business based on their lack of scale and expensive advisory staff. For landlords this has meant a high risk of missing out on the best buy-to-let mortgage deal.”
He continued: “Landlords eager to reduce their costs in the face of challenging market conditions are creating a demand for a more technologically-based solution making the supply of buy-to- let mortgages the next sector of the property market that is ripe for disruption. Our success to date rests on matching individual landlords funding requirements against the real-time lending criteria of every buy-to- let lender in the market. The new regulatory and technological changes we are now seeing will enable us to improve still further the service we provide.”
Property Master offers an alternative in the traditional buy-to- let market by using sophisticated algorithms to dynamically match buy-to- let landlords funding requirements to over 90 prospective lenders who offer in excess of 2,000 different buy-to- let mortgages. Since Property Master’s launch in May of this year 10,000 landlords have made use of its services, with a typical remortgage saving individual landlords over £1,800 per annum against their current outgoings. Over time the company plans to offer a range of other products and services also targeting the private rental market making it the destination site for landlords.
Property Master has already attracted financial backing from a broad range of private investors including a minority stake being taken by LSL Property Services, whose estate and letting agency brands include Your Move and Reeds Rains.