The Resilient Performance of OSB Group in the UK Mortgage Market
The UK mortgage landscape is continuously evolving, influenced by economic shifts, changing consumer behavior, and regulatory frameworks. Amid these dynamics, OSB Group has emerged as a formidable player, showcasing impressive performance metrics in the first half of the year.
Exceptional Lending Growth
Jon Hall, Group Managing Director for Mortgages and Savings at OSB Group, reported that the company achieved £1.9 billion in lending across 8,000 loans. Additionally, product transfers showed significant activity, with around £1.5 billion across 7,000 loans.
“You look at those numbers in aggregate and that’s nearly £4.5 billion of lending and over 15,000 borrowers that have engaged with us,” Hall stated, emphasizing the importance of delivering an excellent service to clients.
This robust growth is underscored by a £2 billion increase in savings, attributed to 133,000 new accounts. Hall noted that this surge in savings has allowed OSB Group to continue funding its specialist lending initiatives effectively.
OSB Group’s lending performance demonstrates resilience in a challenging market.
The Buy-to-Let (BTL) Market: A Closer Look
Hall highlighted ongoing activity within the professional landlord segment of the BTL market, which includes limited companies, Houses of Multiple Occupation (HMOs), and purpose-built student accommodation (PBSA). While some smaller landlords have exited the sector, Hall suggested that the narrative around a mass exodus is likely overstated.
“I do think that you’ll get some parts of that market who are very focused on refinance, very rate-sensitive, and are a bit transactional around it,” he explained. “You get others who are a bit more acquisitive, which is the professional market.”
In this context, professional landlords, often with a portfolio of low or unencumbered mortgage properties, are seeking opportunities to expand their holdings.
Commercial and Bridging Finance Opportunities
OSB Group’s strategy also encompasses a notable commitment to commercial and bridging finance. Hall pointed out the continuous evaluation of which commercial asset classes are performing well, noting logistical sectors such as warehousing and semi-commercial properties as areas of interest. He stated,
“You’re getting those professional landlords or investors that are looking to spread their risk and look at maintaining or growing their yield.”
This approach reflects a proactive stance in supporting investors amidst a landscape of evolving market demands. Bridging finance is particularly appealing, with OSB Group stepping up its efforts in regulated bridging for needs such as property conversions and refurbishments.
The UK commercial property market presents multiple opportunities for growth.
A Fresh Injection of Energy from Government
In a broader market context, Hall remarked on the recent governmental shifts, likening them to an “injection of energy” into the property sector. He expressed optimism towards a more engaged governmental approach to housing and housebuilding, emphasizing the need for a balanced strategy that addresses both the private rented sector and homeownership.
However, he noted that while some changes have begun to take effect, momentum is still building. “A lot of people are still saying: ‘Let’s wait and see how these policies come through,’” Hall said, acknowledging cautious optimism among stakeholders.
Strategic Focus on Product Transfers
Notably, OSB Group has adopted a proactive strategy regarding product transfers. Hall explained how they invested in capabilities within their sales team to enhance the product transfer experience not just for borrowers but also for intermediaries.
“We’re about relationships. We want to grow through retaining strong relationships with our borrowers and intermediaries,” he emphasized.
Hall’s insights signal a recognition of the need for a customer-centric approach in an increasingly competitive market, where customer retention can be as crucial as acquiring new clients.
Enhancing customer relationships is key to OSB Group’s growth strategy.
Future Directions: A Focus on Relationships and Growth
Moving forward, OSB Group aims to expand its commercial and bridging sales teams. With about 100 sales professionals across its brands, the group recognizes that these relationships are integral to its success and ongoing expansion.
Overall, OSB Group’s strong half-year performance indicates its ability to navigate a complex mortgage environment effectively. With a focus on delivering quality products, strengthening relationships, and adapting to market changes, OSB Group is well-positioned to continue its growth trajectory in the UK mortgage market.
Conclusion
As the UK mortgage market continues to adapt to new economic realities, OSB Group stands out for its strong performance, strategic growth in lending and product transfers, and commitment to nurturing relationships with borrowers and intermediaries alike. This foundation will undoubtedly support its ambition to thrive amid the ongoing challenges presented by the British housing landscape.
