Competitive Landscape of the UK Mortgage Market: Where Next for Lenders?

Table of Contents

• CATALYST
• SUMMARY
• METHODOLOGY
• ANALYSIS
  • 2005 was a difficult year for most lenders
    • Market shares in 2005 remained pretty similar to the year before
    • But many saw new business decline in 2005
  • However, H1 2006 is more telling in regards to lender strategies
    • The strong performance of the mortgage market was reflected in most lenders' performances
    • HBOS: back in the game?
    • Abbey: continuing recovery
    • Nationwide: going for broke in a u-turn on pricing?
    • Lloyds TSB: losing market share in an expanding market
    • Northern Rock: success and continued acquisition
    • Alliance & Leicester: expansion into new areas of the market
  • In fact, the competitive structure of the market is changing
    • Increasing involvement by investment banks is changing the market
      • Pricing will become more competitive
    • The boundaries are slowly blurring between the mainstream and non-standard sectors of the market
      • Mainstream lenders have been entering the non-standard sector
      • A few non-standard lenders have been entering into the mainstream sector
      • Technology has had a large hand in this movement
  • Moreover, what will the competitive landscape of the market look like in ten years time?
    • Consolidation will continue
      • This is particularly true for building societies
    • Some investment banks will sell their share of business as profitability declines in the sub-prime sector
    • Streamlined processes will be the norm
    • In the long-run, there will be a number of giant or super players who will dominate the mortgage market to a much greater degree than at present
• APPENDIX
  • Supplementary data
  • Definitions
    • Balances outstanding
    • CAGR
    • Gross advances
    • Non-standard
  • Further reading
    • European mortgage reports
    • UK mortgage reports
    • UK mortgage briefings
    • Forthcoming mortgage briefings
    • UK Mortgage Market Map 2006
      • Key Features
      • For further information
  • Relevant links
  • Ask the analyst
  • List of Tables
    • Table 1: Top 30 mortgage lenders by balances outstanding, 2004-2005
    • Table 2: Gross advances and market shares of top lenders, H1 2005 and 2006
    • Table 3: Gross advances for the top fifteen lenders, 2004-2005
  • List of Figures
    • Figure 1: Many of the top fifteen lenders' new lending volumes contracted over 2005 compared to the previous year, 2004-2005
    • Figure 1: While HBOS, Abbey and Barclays increased their share of the market, Lloyds TSB saw a loss of share, H1 2005 and H1 2006
    • Figure 3: The UK Mortgage Market Map 2006 covers a wide range of mortgage sectors
    • Figure 4: Taxonomy of UK Mortgage Market Map 2006
    • Figure 5: Datamonitor' s core consulting capabilities