Blog: Can homebuying learn from Open Banking? – Mortgage Strategy

When Open Banking was first introduced, there was understandable scepticism. Why would banks make it easier for customers to share their financial data? Could organisations that had spent decades competing with one another really work together in a way that benefited everyone?

The answer, as we’ve seen over recent years, is that they could. Banks still compete fiercely for customers, products and market share, but they do so within a framework that allows data to move securely and efficiently between participants.

Rather than weakening competition, Open Banking shifted where competition happens. Firms now differentiate themselves through better products, stronger service and customer experience, while common standards help the wider financial system operate more effectively.

The homebuying market may now be approaching a similar turning point.

The Government’s latest Home Buying & Selling reform sets out an ambitious vision for a faster homebuying process with greater transparency, improved visibility of transaction status and wider adoption of digital technologies. Earlier access to property information, electronic identity verification and better use of digital processes should all help reduce delays and improve certainty.

However, as Open Banking demonstrated, meaningful change depends on more than new technology or regulation. It requires an industry-wide commitment to improving how participants work together.

That is no small challenge. A typical property transaction involves lenders, brokers, conveyancers, estate agents, surveyors, valuers and local authorities, each responsible for a different stage while operating within separate systems. Although every participant may perform its own role well, the handovers between them often create unnecessary delays, duplicated effort and avoidable frustration. They experience one transaction and judge it accordingly, caring far less about who owns the next action than whether progress is being made.

This is where the comparison with Open Banking becomes particularly relevant. The comparison is not exact: Open Banking developed within a relatively clear regulatory and technical framework, while homebuying spans a broader mix of regulated and unregulated participants, data owners and public bodies.

Open Banking’s success came from agreeing how information should move between participants, allowing firms to continue competing while removing unnecessary friction from the customer journey. It also showed that consumer confidence develops through practical experience rather than technology alone.

Early concerns centred on trust, data privacy and whether there was any real benefit, but today millions of people use Open Banking because it delivers tangible improvements, from faster payments to simpler affordability checks and mortgage applications. The technology itself has become almost invisible.

Homebuying has an opportunity to follow a similar path. Buyers are unlikely to embrace digital tools simply because they exist, but they will value fewer delays, less duplication and greater certainty. Delivering those outcomes will inevitably require firms that have traditionally operated independently to collaborate more closely.

That may not always be commercially straightforward, but reducing friction between participants is far more likely to improve the customer experience than simply making each business more efficient in isolation.

The period between mortgage offer and completion demonstrates why this matters. While considerable investment has significantly improved the front end of the mortgage journey, much of the activity that follows still relies on emails, manual administration and disconnected processes. Professionals spend too much time chasing updates, responding to queries and coordinating activity instead of progressing transactions, creating unnecessary cost for firms and uncertainty for consumers alike.

The next opportunity therefore lies in structured digital workflows that allow tasks, decisions and responsibilities to pass more efficiently between participants. In practice, that could mean verified property information, outstanding enquiries and next actions moving securely between agents, lenders and conveyancers without being repeatedly rekeyed or chased.

Rather than introducing another stand-alone platform, the focus should be on reducing duplication, improving coordination and giving every party greater confidence that a transaction is progressing as it should. That allows each organisation to focus on the expertise and service that differentiates it, rather than the administration that too often slows the process down.

Perhaps the biggest lesson from Open Banking is that collaboration and competition are not opposites. Businesses can continue competing on products, service and expertise while working together operationally to remove friction from the customer journey.

If the homebuying industry can establish that common foundation, firms will remain free to differentiate through expertise and service while consumers gain a transaction that feels like one connected journey rather than a series of disconnected handovers.

Andrew Vaughan is head of customer management at e4 Strategic