Spotting a gap in the Dutch mortgage market, we have expanded NIBC Direct’s fast-growing residential mortgage portfolio to include buy-to-let investors. NIBC Direct started selling its own label mortgages in 2013 and in just over a year has gained a 2.5% share of the Dutch residential mortgage market ‒ the biggest advance of all Dutch mortgage providers. First-time buyers, especially, are attracted by our honest and simple products and competitive interest rates. Also working in NIBC’s favour is our cooperation with the independent intermediaries who sell our mortgages.
“Our distribution partners value our reliability, speed in processing applications and in-house expertise,” says Richard Leijnse, head of marketing and sales at NIBC Consumer Banking. Clients appreciate our client-centred strategy. “There are a lot of components in our products that are in the customer’s best interests. In addition, we maintain close contact with people who run into mortgage repayment problems, offering them budget coaching, temporary interest holidays and loan restructuring, for example.”
Demand for mortgages among first-time buyers was helped by a recovery in the Dutch property market, which grew 33% in 2014. This improvement seems likely to continue in 2015, which will stimulate demand among homeowners looking to upgrade to a new property or refinance their mortgages.
Recognising this, we expanded our portfolio from annuity mortgages (which have a tax rebate, making them more popular among newcomers to the housing market) to add interest-only and linear mortgages. These appeal more to second-time buyers and people looking to refinance. We also spotted another gap in the market – buy-to-let mortgages.
Although common in countries such as the UK, buy-to-let is a niche market in the Netherlands, where residential rental properties are mostly owned by large housing corporations. But a growing number of people want to buy houses they can rent out. It’s an attractive investment: house prices have fallen more than 20% since 2008, yet rental prices and the demand for rental properties have remained consistently high.
This new product caters for individuals ranging from people buying a single investment property to seasoned investors expanding their property portfolios. The loans run up to a maximum of EUR 10 million. “Buy-to-let launched at the end of January 2015 and it’s been very positively received,” says Dirk van den Beukel, head of strategy and development at NIBC Consumer Banking. “It confirms our belief that this is a market that has been underserved and where we are well placed to meet the demand.”