The great North/South divide – calling all Southerners, what’s the deal?

The great North/South divide – calling all Southerners, what’s the deal? 

This old chestnut has been around as long as I can remember, so I'd like to take a look at the ‘divide’ in more detail, and hope to stir up some response from the Southern brokers.

Sunday morning, whilst eating my three shredded wheat and daydreaming about the weekend’s football fixtures, my wife broke my reverie and said: “Bob, you should become a broker in London.”

Her reasoning was that property prices were so much larger than in my native South Yorkshire that it should follow that the mortgage requirements would also be larger, and that means more wonga to yours truly, (well to our lass).

This outburst was thanks to her Sunday morning perusal of the “Homes” section of The Sunday Times. As we know, there are some amazing properties in there, plus amazing price tags to boot. So who buys these properties? And more importantly, who does the mortgages for these folk?

As far as my residential mortgage broking goes, I work on a self employed basis within Citri (a directly authorised firm) and the mortgage professionals within Citri come from all corners of the UK – as far as I'm aware. So we all have the same opportunities, are all backed by the same mortgage sourcing software, are all privy to the same exclusive and run of the mill mortgage products and, most importantly, the same procuration fees.

Let's say for example that the average procuration fee is 0.35%. In the last 12 months my residential mortgage average is £87,725, that's from 8 residential mortgages that I put through, my main thrust is commercial, bridging, and development finance, but these eight deals found their way into my business.

The average procuration fee was £307 on those deals, yes there's the protection and GI and any fees to boost that figure, but the point is the size of the procuration fees. So my questions to Southern brokers are:

What is your average residential property value? What is the average mortgage? What is the average procuration fee? 

Whether I look at my largest, or my smallest, case the work is exactly the same, the same time to fact find, to conduct research, to present and submit the business, and of course to follow the process through to completion.

So if all my cases were residential and all followed the same averages, let's say about £50,000 worth of gross income, am I, or my missus even, right in saying that if we only did London-based broking we would be at least 5 times better off as far as income goes?

We all know that the cost of living in the South isn't five times larger, larger yes, but not to that extent. When I venture down south, well past Chesterfield, the cost of my drink allowance and food intake is not too dissimilar to up here in the smoggy North.

I know that the properties in the “Homes” section is not what most brokers will be involved in, but still, all the same, I'm interested in the thoughts of Southern brokers. In a recent meeting with a residential BDM, she told me that she had one local adviser who only advertised in London, it must be worth it I thought...