PARADIGM MORTGAGE NEWSLETTER AUTUMN 2025 www.paradigm.co.uk/mortgages
4 Paradigm Mortgage Services Introduction from Paradigm Richard Howes 8 AIR Unlock your potential with Air 12 Paradigm Mortgage Services Summer School of Marketing: A Resounding Success! Aimee Carnwath CONTENTS
Marsden Building Society is a member of the Building Societies Association. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority, under registration number 206050. Principal Office, 6-20 Russell Street, Nelson, Lancashire BB9 7NJ. *Calls will be recorded and may be monitored. FP196305 FOR INTERMEDIARY USE ONLY A specialist lender with a common-sense approach to... Lending into Retirement Later Life Lending Retirement Interest Only Expat Residential Expat Buy to Let Furnished Holiday Let We know not all cases are straightforward, so we apply a common-sense approach to lending, helping you to find a place for your clients with the Marsden. We don’t work on a ‘computer says no’ basis. We know that every mortgage is different and that’s how we look at cases submitted to us. We don’t credit score. Your clients are more than just a number and we know that a credit score isn’t always straightforward. We assess each case on its own merit, and our teams have access to key decision makers for cases that are a little different. Why not get in touch today? Speak to our team about your case 01282 440583* [email protected] www.marsdenintermediaries.co.uk
Hello, and welcome to the Autumn edition of our Newsletter. As we move into the final parts of 2025, the UK mortgage market stands at an interesting juncture—one shaped by a confluence of macroeconomic pressures, shifting regulatory landscapes, and evolving borrower behaviour, and that’s before we comment on the regulator pushing lenders further up the risk curve and allowing borrowers in a climate of Consumer Duty to see their mortgage as a ‘do it yourself’ tool. I think it is fair to say the year so far has been marked by a cautious recovery, subtle resilience, and a persistent undercurrent of uncertainty. 2025 has by no means been a return to "business as usual." Instead, it has revealed a market adapting to a new normal: higher-for-longer interest rates, relatively uncertain housing activity, affordability issues for all types of borrowers. The most recent meeting of the Bank of England’s Monetary Policy Committee showcased the extent of the dilemma faced by the policymakers charged with setting UK interest rates. The nine members voted by a margin of five to four for a cut. That the decision is no longer intuitive is explained by the “hawkish” slant of recent economic data, with GDP growth low, inflation rising and remaining annoyingly above the BoE’s target. We are now in that period of the year when many lenders will be looking at their performance for the year thus far and their requirements for completions and applications, (the latter being their pipeline barometer) which will determine in some way their pricing until the end of the year. 27Tech reported, “there are now 26,933 products available to advisers and their clients, the highest number on record. August also marked the first time that more than 900 products were added in a single month, highlighting the fierce competition among lenders to attract borrowers”. Fixed-rate mortgage pricing has as we know gradually been edging downward this year as lenders adjust margins in response to falling swap rates and expectations that the BoE may begin cutting rates in early 2026 along with the overall economic uncertainty. Over the last 10/15 years fixed-rate mortgages as we know have become the only real deal in town, apart from when ERC free Trackers came to the fore at the beginning of the pandemic and then left as quickly when lenders realised what could happen to this book of business! Naturally, a fixed rate mortgage slows down how quickly changes in Bank Rate affect household mortgage payments. Currently: • 30% of mortgages are on 2-year fixed deals • 55% are on 5-year fixed deals • 5% are on deals between those durations • The remainder are on variable rates. This means the average mortgage rate paid changes only every 3.5 years. Although a Bank Rate was cut over a year ago, its full impact hasn’t yet reached many borrowers. For example, someone who took a 5-year Richard Howes Director of Mortgages Paradigm Mortgage Market Update 04 MORTGAGE NEWSLETTER
fixed mortgage before the December 2021 rate hike won’t see higher payments until late 2026. Interestingly, according to 27Tech in their latest market update, the type of products borrowers are searching for is changing too. “Ten-year fixed deals now account for just 12.41% of searches, the lowest ever share. That is down from 22.62% in August 2024 and from a peak of 36.71% in June 2022. Instead, shorter-term fixes are proving more popular, with many borrowers prioritising flexibility in a shifting rate environment”. The average mortgage rate paid is expected to peak in October at 4.00% according to Capital Economics, up from 3.88% in June. Even if the Bank Rate drops to 3.00% by 2026, the average rate paid would still be around 4.00% by the end of 2027, unless more borrowers switch to shorter-term or floating rate deals. Mortgage approvals have shown a modest improvement in 2025, with a slow but steady uptick in activity since the spring. According to Bank of England data, net mortgage approvals for house purchases have averaged around 55,000 per month, a slight increase from the 2024 average, though still well below pre-pandemic norms. Gross mortgage lending is expected to total approximately £240–£260 billion for 2025, although Lloyds have recently suggested this could go up to £285Billion excluding Product Transfers which add considerably to the overall market. This growth has been driven largely by a pick-up recently in remortgaging activity and a modest return of first-time buyers, spurred by improving lender competition and the gradual introduction of targeted affordability support. The housing market “retreated slightly” over July making previous signs of recovery uncertain, research from the Royal Institute of Chartered Surveyors has found. Rics’s UK Residential Survey for July 2025, found the tentative signs of recovery that emerged 05 MORTGAGE NEWSLETTER Continued on next page... in June’s survey were partially reversed, with measures of demand and agreed sales slipping back into slightly negative territory. But, Zoopla’s August’s House Price Index shows a 5% rise in sales and 4% increase in buyer demand. Although, regional differences persist, with northern areas seeing quicker sales due to better affordability, while southern regions face slower transactions. House price growth has slowed to 1.3% annually, with the average UK home now valued at £270,600. Increased supply and affordability pressures are key factors. Speculation around potential tax reforms, such as replacing stamp duty with an annual property tax for homes over £500k, has introduced uncertainty ahead of the Autumn Budget, potentially impacting buyer sentiment and market activity. Zoopla expects house price inflation to remain between 1.5–2% for the rest of 2025, with total sales forecast to rise 5% year-on-year. In monetary terms it appears the residential mortgage market is running at a level of £6.1bn per week with the number of Applications running at 25,585. The yearto-date cumulative Application value is now £207bn, a 22% increase on the same period in 2024. In the “battered” Buy to Let market the average weekly total appears to be flattening out at £844m. Whilst the purchase market appears under strain it is good to see the Remortgage market remain strong. The resilience in the market is reflected in a recent BTL barometer report from TML which states landlord confidence in the near term prospects for the PRS remains steady, with a slight increase in rental yield confidence. In terms of the BTL market dynamics TMW report in the barometer, the proportion of landlords putting rents up in the last 12 months is 5% lower than a year ago. It goes onto say 4 in 10 landlords will remortgage or take a product transfer in the next year, 22% of which will be in a limited company1. Source: 1. TMW Landlord Trends report Q2 2025
06 MORTGAGE NEWSLETTER objective of building 1.5 million homes in this Parliament. Whist we have heard of all the reports we don’t have enough Plumbers, Electricians, Bricklayers, land etc, one area caught my eye for consideration which will impact on this target. Did you know, UK cement production has fallen to its lowest level since 1950. Cement I am sure you know is the key binding ingredient in concrete, which is the most widely used material in the construction industry, and mortar. The Mineral Products Association (MPA) said production levels were "increasingly under threat" due to high energy, regulatory and labour costs. According to the MPA, about 40% of British cement is manufactured in the Peak District, with the rest of the production spread across the UK. Here is the “kicker”! The UK made 7.3 million tonnes of cement in 2024, according to the MPA, which represents manufacturers of products such as asphalt and cement. That was about half of that produced in 1990 and similar to production levels seen when rationing was still in place following the World War Two. Production has declined to a level similar to the 1950’s which will impact government targets like homes and hospitals and power plants that are due to be built. A project such as the Sizewell C nuclear power plant could need up to 750,000 tonnes of cement and a new hospital would require nearly 8,000 tonnes. A traditional fourbedroom home needs between three and five tonnes! Meanwhile, the Consumer Duty regime is now two years old! Where has the time gone! Brought in to enable lenders and advisers demonstrate fair treatment of customers, particularly those in vulnerable circumstances it appears incongruous that Consultation Paper 25/2 is now Policy Statement PS25/11. If you are not aware of this please contact us to know more, in essence this is the rise of execution only business moving forward for the benefit of dare I say the big 6 lenders to “claw back” market share What is undeniable in our market currently is the level of uncertainty being created possibly by testing headlines which may have no legitimacy but which don’t help to create an environment of confidence. In August we saw the arrival of the potentially new Property Tax to replace Stamp Duty for properties valued at over £500,000, this has now been followed by the headline in one trade magazine of “Landlord ‘assault’ as Reeves eyes NI on rental income”, where it is suggested the Chancellor may apply national insurance to rental income in the upcoming Autumn Budget in the hopes of raising £2bn. Of course the Treasury are not commenting on such headlines, but the uncertainty this causes has a ripple effect not on the housing & lending markets but on the economy as a whole. With the Housing market being front and centre of much of this Governments policy to get the economy moving it has become a key battleground. Currently, the Government have 7 proposed initiatives available for customers to access to get on the housing ladder, but none seem to have the gravitas that HTB had stimulus wise. It will interesting to see if the new Housing Minister keeps to her predecessors
from the broker market, undoubtedly reduce costs in the overall acquisition of customers and grow their back book further. It appears to “fly” in the face of Consumer Duty, where we could see the real return of dual pricing, dual affordability models, I think Seb Murphy of the JLM Partnership put it so well in an article in Mortgage Solutions by saying, “it’s about nudging customers down the path that costs lenders less. The danger is obvious: a twotier market in which advised borrowers are penalised on price and non-advised borrowers are left without protection”. “Paradigm has always championed the independent mortgage broker and, given that the Mortgage Rule Review consultation response deadline was only a matter of weeks ago, we share the disappointment voiced by Association of Mortgage Intermediaries (AMI) that the FCA has chosen to press ahead with their proposals, and at such a pace. We have previously voiced our concern that this change carries the potential for consumer detriment and poor outcomes and we maintain that position, but at the same time we also expect strong ongoing support for the intermediary channel from lenders. Finally, the new rules are optional, not mandatory. Lenders will need to assess how and when to apply them, including updating systems, training staff, and ensuring compliance with the Consumer Duty. If you would like to read more on this subject our policy team at Paradigm consulting have produced an excellent synopsis at Regulatory Updates “Mortgage Rule Review: First steps to simplify our rules and increase flexibility”. Here at Paradigm we have for the last few months given real consideration to AI and its potential impact on ours/your business. It’s a huge cliché to say technology is reshaping the mortgage experience, but having spent time with lenders and in my own reading on the subject of AI one can’t 07 MORTGAGE NEWSLETTER help but be left with the feeling this is the real “gamechanger” not just for our market but for society as a whole. Whilst we at Paradigm have sought to understand AI in great detail, we would also like to know what you are thinking of this area. We have created a survey to gauge your thoughts.* It will take 10 minutes maximum and gives you the chance to tell us what you think, and maybe what you need in this regard to help your overall understanding for your business. It would be great if you can find the time to complete it as we will use your feedback to assess how we can help inform and educate further given it is not going away. In addition we are working to offer some free tools to help you look at your business with technology in mind by assessing your marketing capability now and in the future so please look out for this! Consumer expectations have shifted dramatically, particularly among younger buyers. The expectation of real-time updates, seamless applications, and instant decisions is now standard. The winners in the next phase of the mortgage market will be those who combine competitive pricing with superior digital infrastructure and human-centric advice. Here at Paradigm we remain cautiously optimistic for the end of the year, our recent performance in applications and completions has seen us post some record returns, so thank you it is down to you our advisers and your teams we are able to do this. Obviously, challenges abound but please be assured we are on the front foot to understand them and turn them into opportunities. Whether you're navigating the challenges of today or preparing for the market of tomorrow, we’ll be here to provide the insights, data, and analysis you need to stay ahead. Talking of opportunities, this quarters edition has some great insights from our contributors which I am sure will help you in your business and as always our thanks go to them for their sponsorship. * Survey Closes on 1st October
By Air Marketing Team In later life lending, the stakes are even higher. Your advice can help clients unlock wealth, secure peace of mind, and live more comfortably. That guidance can be lifechanging. And yet, to deliver it well, advisers need more than just knowledge of products. They need tools, confidence, and the right community around them - that’s where Air comes in! Air is the UK’s leading later life lending platform, bringing together over 10,000 advisers who share a commitment to better customer outcomes. We combine technology, knowledge, and people into one connected ecosystem designed to help you seize opportunities and thrive in a market that’s evolving fast. The real question is: why wouldn’t you want to be part of it? We’re a Club At its heart, Air is a community. Through Air Club, we bring together advisers from across the country and give them access to the tools, rewards, and support they need to succeed. Whether it’s commercial benefits, smart technology, or confidencebuilding knowledge, Air Club helps you unlock your potential. With more than 10,000 members already benefiting, Air Club is the hub for advisers who want to grow their businesses, elevate their advice, and deliver better outcomes for customers. We’re your marketing partner Standing out in today’s competitive market isn’t easy. That’s why Air Marketing exists — to give you ready-made resources that put you in front of the right people, with the right message. From pre-designed campaign assets and lead generation guides to templates you can use with introducers, Air Marketing provides you with the expertise to make a lasting impression. Whether you’re reaching out to new clients or strengthening existing relationships, we help keep you front of mind. We’re about tools and technology Air’s connected suite of tools empowers advisers to deliver advice that is smarter, faster, and more tailored to customer needs. • Air Navigator – Identify over-50s prospects, uncover their financial needs, and build a more holistic picture of their options. It’s your route to expanding your reach and supporting clients with confidence. • Air Sourcing – Our powerful sourcing platform gives you the ability to deliver fast, tailored advice. With enhanced criteria filters, a borrowing forecast tool, quick source functionality, and API integrations, it puts precision at your fingertips. • WriteRoute – A fact-find tool that guides you seamlessly through the advice process. From in-depth data capture to suitability reports and KFI creation, it’s built to help you support clients and stay compliant. • AirFlow – The central workflow tool that ties it all together. AirFlow integrates the Unlock your potential with Air 08 MORTGAGE NEWSLETTER Helping customers make informed, confident financial decisions isn’t just important — it’s essential.
wider Air offering, tracks progress, and automates steps in the advice journey — freeing you to focus on what matters most: your clients. We’re an Academy The later life lending market is complex. Products evolve, regulations tighten, and customer needs shift. That’s why ongoing learning is critical. Through Air Academy, we deliver industryleading, LIBF-endorsed training that equips you with the knowledge and confidence to navigate this changing landscape. From structured CPD modules to practical case studies, Air Academy ensures you stay informed, stay ahead, and deliver advice that makes a real difference to your customers. Shaping the future together Air isn’t just about supporting advisers — it’s about shaping the future of the market itself. That’s why on 22nd October, we’re hosting the Virtual Masterclass: Breaking down silos. This online event is designed to give you the insight, strategies, and confidence to embrace holistic advice and stay ahead in a fast-changing market. You’ll hear from leading voices — including the FCA, Perenna, more2life, Canada Life, Just, and Legal & General — as we explore how to: • Embed later life lending into broader financial planning conversations. • Connect regulation, innovation, and client needs into a future-ready advice model. • Turn complexity into opportunity and gain a competitive advantage. This Virtual Masterclass is more than just a regulatory update. It’s your chance to engage with thought leaders, sharpen your edge, and build stronger outcomes for your clients — all without leaving your desk. And by attending the full session, you’ll also earn 2 hours of structured CPD. REGISTER TODAY Why advisers should get involved If you’re an adviser who hasn’t yet connected with Air, ask yourself: • Wouldn’t you like access to smart technology that streamlines your advice process? • Wouldn’t you like ready-made marketing support to keep your business front of mind? • Wouldn’t you like the backing of a community of 10,000 advisers? • Wouldn’t you like to join a platform that is shaping the future of later life lending? Air gives you all of this — and more. Don’t get left behind The UK’s financial landscape is shifting. With over £3.7 trillion in later life wealth waiting to be unlocked (JUST, 2025), the opportunity is clear. The FCA is calling for bold change, and the advisers who step up now will be the ones who set the pace. Air is here to help you do exactly that. With our blend of tools, knowledge, and community, we give you everything you need to thrive. So don’t just watch the market evolve. Be part of it -Unlock your potential with Air and Discover more 09 MORTGAGE NEWSLETTER
12 WINTER MORTGAGE NEWSLETTER For Intermediary use only. Content correct at time of publishing. YOUR MORTGAGE WILL BE SECURED ON YOUR PROPERTY AND YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and Prudential Regulation Authority. Firm reference number: 157260. Assess many types of complex income Airbnb considered Top slicing available harpendenbs.co.uk/intermediaries SCAN THE CODE TO VISIT OUR INTERMEDIARIES PAGE HOLIDAY HOME/SECOND HOME • We consider a range of incomes, including pension, trust, investment and maintenance as well as 100% of bonuses, overtime and commission (2 years proof required) • We consider latest years income for self-employed applicants • No maximum age • 75% LTV available on IO and repayment HOLIDAY LET • 90 days personal usage allowance per annum • Airbnb considered • We lend in town and city centres as well as coastal areas • We lend on properties above commercial units • Top slicing • Minimum income of £30,000 required • Up to 3 properties on one title considered • 75% LTV available on IO and repayment If it’s complex, we might find a way Best Local Building Society
14 MORTGAGE NEWSLETTER [email protected] 0330 053 6061 (option 6) Find out more here or get in touch: Paradigm's Test Zone on our award-winning CPD Academy: Allows advisers to regularly test their knowledge and understanding of key areas of risk Helps firms meet their annual training requirements Our tests can be used to help demonstrate and certify that advisers are ‘fit and proper’ to perform their role. You can now take tests on the following subjects: Anti-Money Laundering GDPR Obligations Senior Manager & Certification Regime (SM&CR) Conflicts of interest Mortgage Fraud Complaints Handling Code of Conduct Anti-Bribery & Whistleblowing SM&CR Certification Protection Product Knowledge Vulnerable Clients General Insurance Consumer Duty Cyber Security Mortgage Product Knowledge Threshold Conditions
I'm truly amazed that we've already completed our fourth annual Summer School of Marketing Month, and what a huge success it's been! We understand the daily stresses advisers face in the current climate, especially when it comes to generating new business leads. That's why we created a four-week rapid-fire tour around marketing, packed with practical ways to improve your website, social media, and other customer touchpoints. Throughout the month, the Paradigm marketing team unveiled a wealth of valuable content designed to help you build your marketing from the ground up. We dived into some of the hottest topics in the industry, from exploring the incredible power of AI in marketing to mastering social media. We also showed you how to leverage free marketing tools and how to maximise your website’s potential to turn it into a lead-generating machine. We know how busy you are, so we've been serving up all this fantastic content in easily digestible formats. We provided insightful articles, engaging videos, and visually striking infographics, ensuring there was something perfectly suited for every business and every learning style. Our goal was to make this valuable information accessible and easy to implement, so you can start seeing results right away. This year's Summer School of Marketing was all about going back to basics and giving you the foundation you need to transform your marketing efforts. We’ve been thrilled by the feedback and the engagement we’ve seen, and it’s been incredibly rewarding to know that we’ve been able to help advisers navigate the complexities of modern marketing. If you missed it through August, or want to revisit some of the content, don't worry—it’s not too late to catch up! All the resources are available for you to explore at your own pace. You can dive into the articles, watch the videos, and download the infographics whenever it’s convenient for you. We believe that effective marketing is key to long-term success, and we're committed to providing you with the tools and knowledge you need to thrive. Are you ready to transform your marketing? Catch up with our Summer School of Marketing content and build your marketing from the ground up! Summer School of Marketing: A Resounding Success! 12 MORTGAGE NEWSLETTER Aimee Carnwath Senior Marketing Coordinator
11 MORTGAGE NEWSLETTER Catch up on our 2025 Marketing Month HERE!
www.paradigm.co.uk/mortgages 0330 053 6061 [email protected]
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