has been a marked improvement for the Barclays mortgage team, he is tempered in his attitude to the wider market. “It’s too early to predict what gross


lending will be for 2011,” he says, “But it’s likely to be on a level with this year which I think will be around £140 billion, Barclays’ current official view.” Incoming regulation and the move


towards the FSA’s view of a sustainable mortgage market will mean no growth over the next eighteen months, he says. “It’s going to be another same-as


year: dull would be the wrong word, but certainly same-as. And I don’t necessarily think that’s a bad thing. There’s regulation coming down the line and I think we’ve all got to get to grips with that. “There’s a lot of ambiguity out there:


a new government, a state package in terms of what’s come out of the Budget, lots of people thinking ‘actually, am I going to have a job, am I going to get a salary rise, what can I afford?’ and that’s going to keep the market flat. “If we have a period of stability where


we can get back on our feet, regain a stable economy and see house price indices moving ever so slightly up, I think that will give us a solid foundation to take the industry on.” The years 2012, 2013 and 2014 should


see growth in the mortgage market, he says, but 2011 will be a reflection of 2010.


opporTunITIes But Finlay is no pessimist. Realist, yes, but he tends to see the silver lining. “I think there will be a massive


opportunity coming up probably not this year but next as the remortgage market kicks in. I think everyone’s looking at that. All lenders’ back books will have a huge number of people on a standard variable rate and those borrowers will be looking to switch off as interest rates rise.” There are other opportunities in the new


market as well, says Finlay, who believes that our accepted understanding of homeownership is due to shift. “The buy-to-let market definitely


presents an opportunity - if you look at the number of housing units we’re likely to need in the next few years there could be something like a million shortfall. And when I think of my kids coming out of


university, laden with debt, finding it harder to get jobs, where are they going to live? That dynamic will change – I know the average age of the first time buyer is already creeping up and up.” The place of the first time buyer is


crucial he says. “Personally, (bar funding) I think the


biggest issue for the industry is when and where first time buyers come into the market because you have to have that feed. Otherwise, eventually the market will stagnate.” “I do think there now has to be a


realisation that the first time buyer that was isn’t going to look like the first time buyer that is. It’s understanding that and bridging that gap. That’s where buy-to-let could come in. “It’s how you facilitate and innovate


to meet the demand that there is and that’s developing. Currently we do less than 5% buy-to-let but there is potentially an opportunity for us to grow that. We need to look at our commercial plan and where we want our balance of risk to lie.” It’s time for the market to change, Finlay


says definitively, and he’s positive that innovation and competition will be the driver of that change for the better. “Funding is the biggest threat to the


market,” he says. “We’re all in a position where none of us really knows what the future on funding is. We know that Basel III is coming in and will impact our capital requirements. Our tier one ratio is currently 10% at the moment which is historically and internationally high. So we’re secure now and we are government debt free. “But on a market scale there are still


big question marks over the repayment of the Special Liquidity Scheme and the Credit Guarantee Scheme not to mention generally higher capital requirements. It’s a risk for the wider economy because the housing sector is part of the economy and many of the biggest lenders are going to have a task in paying back. “If I had one plea to the government it


would be to go back and have another look at funding. “If you have funding in the market


then it will become more vibrant and we’ll see more entrants and that will help bring more people in. There will be


opportunities, albeit strictly controlled and regulated. Gone are the days of being able to lend and run away. “There’s a need in the market, and


where there’s a need, somebody entrepreneurial will come along and fill that need.”


The FuTure’s brIghT When asked to sum up his thoughts on the mortgage market, Finlay is surprisingly hopeful. “I love this industry,” he says. “But


it’s the people who really make it. It’s filled with great people with really good intentions. We may have differences in opinion but actually I think we’re all working for the same thing. “I think sometimes we talk ourselves


down as an industry, especially over the past couple of years, and I don’t think we value ourselves highly enough. That disappoints me. “But for those who remain when the


market comes back holistically, I think it’s a really bright future.” n


THE MAN BEHIND THE WOOLWICH


David Finlay, Intermediary Channel Director 49, married, two children Lives, Kenilworth, Warwickshire


Career: 1988 Chemistry and physical education teacher 1990 Management trainee at Leeds Permanent building society 1992 Various BM roles for Leeds Permanent 1996 Regional training manager for Halifax after the merger with Leeds Perm 1998 Area director for Halifax in North Hampton 2000 Head of intermediaries for Barclays, setting up intermediary division 2001 Northern regional director for Barclays Woolwich after the takeover 2005 Director of intermediaries for Barclays Woolwich


Hobbies Rugby, Northampton Saints supporter Football, Celtic FC fan


morTgage inTroducer SEPTEMBER 2010 31


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