LSL: Fair fee-lenders priority in surveyor crisis; firm reports 206% profit rise
Mon 29 Jul 2013
One of the biggest mortgage, estate agency, lettings and surveying firms in the UK, LSL said it will prioritise the
lenders which paid fair fees during the downturn in the current surveyor shortage crisis.
The firm announced profit rises in its H1 results to June of 8.4m, against a -7.9m loss this time last year,
according to its half-yearly interim results to 30 June out this morning.
Group chief executive officer Simon Embley (pictured) said the shortage of surveyors and uptick in mortgage
approvals have caused some of the surveyor capacity constraints evident in the South.
However, he told Mortgage Solutions LSL would priorise the UK lenders desperate for valuation services that
paid fair valuations fees throughout the downturn.
"We are growing capacity for our long-term clients and will prioritise business from those who have not been
aggressive on price reductions. It's been a lender's market for six years. But, we won't be manipulative as we
need to look at this over the longer-term," he said.
Embley said its trainee scheme will produce fully-functioning surveyors within 12 months. In the surveying
division, underlying operating profit was 5.4m, down from 9.7m in 2012. Like-for-like underlying operating profit
was 5.4m, down from 7.2m the previous year.
The parent company of Your Move, and mortgage advice networks First Complete and Pink, admitted its
surveying division had been impacted by a "major contract insourced in June 2012."
Embley said Lloyds' decision to take this surveying contract back in-house had impacted profits, alongside its own
decision to invest into surveying technology and a further 1.5 to 2m investment in its graduate trainee surveying
The firm reported significant improvements in market conditions and group performance since Easter.
Estate agency performed strongly, with revenue from Marsh and Parsons up 5% year-on-year. Underlying
operating profit increased by 28% to 8.4m in the estate agency division alone, up from 6.5m in 2012. Estate
agency sales rose 2% and lettings revenue rose 9% to 24.7m, with financial services revenue up 9% to 15.7m
year on year. Roger Matthews, LSL, chairman, said: "It is expected that the benefits from improved market
transaction volumes will be seen in the second half and we are increasing the rate of investment to build capacity
across both agency and surveying divisions to capitalise on greater activity." First half figures out yesterday
showed mortgage lending overall had despite higher remortgaging figures.
Embley said: "What we're seeing is H1 2013 was in two segments. Q1 this year was disappointing against Q1 last
year, which is when the Stamp Duty holiday ended. Total mortgage approvals from January to April were down
-5%, where May to June is up at +12%."
This accounts for some of the capacity constraints, particularly in the South, said Embley.
In June, the firm agreed a war chest of 100m in loans from four banks set to mature in 2017. The facility
comprises a 95m revolving credit facility and a 5m overdraft facility provided by relationship banks Barclays and Lloyds TSB Bank, joined by HSBC and Santander