Carol Anderson, CML Scotland chair

Transcription

1 Carol Anderson, CML Scotland chair Speech to CML Scotland annual lunch 11 th March Introduction Ladies and Gentlemen good afternoon and a very warm welcome to our annual CML lunch. I am delighted to see so many members, associates and their guests here today. Your support over the years of this event has been greatly appreciated. - Housekeeping Just a slight bit of housekeeping to begin. In the event of any fire alarms please exit through xxxxx. Secondly, can everyone make sure that phones are turned off or set to silent. LinkedIn, s, and tinder can wait for now. - Introduction as Scotland chair For those who I have not yet met, I m Carol Anderson, the new chair of the Council of Mortgage Lenders in Scotland. It s certainly a nice way to begin my tenure in the beautiful surroundings of the Balmoral Hotel in Edinburgh amongst the best and brightest of our industry. This is my first official day as chair so to give a speech to 200 people is a slight baptism of fire to be sure, but the free wine helps. I d like to start by raising a glass to Linda Docherty for her two years as chair. Her spirited tenure came at a time of great change to our industry and I would like to thank her for her hard work representing lenders through it all. I want to continue as Linda left off and represent the needs of Scotland lenders to government, the media and to the public. The CML prides itself on having an open door to the opinions and ideas of

2 our members and associates. And I want to extend this to you all and invite a close collaboration during my time as chair. - Lending in Scotland the past year With a changing of the guard here at CML Scotland, so to speak, I think it is a good time to take stock of our industry. If I was to give my feelings on the current state of the Scottish market in one word, it d be optimistic. Mortgage lending continues to rise. Last year, more loans were taken out to purchase a home in Scotland than any year since Firsttime buyers were at their highest level since Home movers also. And, remortgage lending was up to 2011 levels. All the cogs working at a steady rate, with none over-heating the machine. - Over-arching market issues trends More broadly, despite a muted global economy recently, Scottish exports have risen 40% since the start of the recession. Foreign investment was at its highest in 2013 since 1996, and has sustained this level since. Outside of London, Scotland has been first or second out of the UK regions for inward investment, with most recently our highest level of US investment ever according to the EY s UK Attractiveness Survey. We are truly in a recovery period in Scotland. This is no time to sit back and put our feet up, however. We may feel like weathered veterans used to change having incorporated MMR to our everyday practices so seamlessly. An immense achievement by the industry to make a potential roadblock, a mere bump in the road. Having launched Help to Buy and targeted it successfully to those who it was designed for, with the much speculated overheating by media circles never taking place. Having rolled with further

3 regulatory tweaks put in place post-mmr without it causing as much as a ripple. The smoothness of these transitions should not be underestimated, and you all deserve a pat on the back and the gourmet food you are about to receive for a job very well done. But this is no time for complacency. I d like to raise a few points about our future. First, we are a month away from the European Mortgage Credit Directive, and the UK is the leader across the whole of Europe in getting the job done. Those aren t my words; they are the words of Luca Bertalot, secretary general of the European Mortgage Federation. The CML and its members asked the FCA and Treasury not to reinvent the wheel, and they didn t. We asked them not make new practices work against current practices, and they haven t. There has been a welcome consensus with the regulator that this offers no real additional protection for UK home-buyers, and that implementation should be done in a way that minimises disruption. Secondly, on the home front, the buy-to-let tax changes will come into force this year and we will wait and see the effect on the market. We d have wished the government had waited for the dust to settle before heaping new transaction taxes on top of the landlord tax changes. The CML believes proposals for a 3% Land and Buildings Transaction Tax surcharge on purchase of second properties demands a rethink. Or at least tinkered with so it is not an upfront tax for those with unplanned temporary ownership of two properties. This would be a huge inconvenience to many and we d

4 urge the government to allow buyers to be allowed to defer the payment of higher LBTT for up to 18 months, to cater for temporary situations. The unintended consequences of the proposal to the turnover of housing stock could be substantial, something already running at only two thirds of what it was a decade ago. With the changes to the Private Tenancies Bill, further adding a LBTT supplement on top could have a cumulative impact on landlords and the ability of Scottish Government to deliver a fully cross-tenure approach. If this policy is designed to promote home ownership, we think that there should be better evidence as to why this requires a reversal of growth in the private rented sector. Thirdly, Help to Buy Scotland is now available again, and early signs are good. There has been positive sign-up of major lenders, and customer interest in these early stages has been high. It ll run for three years and, to help ensure ongoing lender support, we d expect Scottish Government to learn from the lessons of its original scheme, and make sure the new scheme operates smoothly without the Stop-Start issues that troubled the original version. Similarly, as the new scheme has more complex parameters than its counterparts in Wales and England we d ask for no further changes from government, so to avoid over-complicating the scheme for customers. Fourthly, on Brexit, it appears historic referendums are like buses, you wait all your life for one, and two appear at the same time. The Scottish people will vote on whether they want to remain in the European Union in June.

5 Views of members will vary, but there is clearly potential for financial market uncertainties. However, I think as an industry we are well placed to mitigate this. We have shown time and again we can roll with the punches and at times take hits on the chin. I have no doubt we can take whatever is handed to us moving forward, which ever side the coin flips. Housing in Scotland is a growth industry that has shown it is adept at evolution. You all have yourselves to thank for that.