Elite brokers have revealed what steps to take now as new research has revealed the market may well cool significantly in the next 12-18 months.
CoreLogic RP Data reported that Sydney house prices grew by 12.4 per cent in 2013/2014. That will slow to 10.0 per cent in 2015/2016, according to forecasts by Propell National Valuers.
Melbourne growth rates are set to fall from 8.3 per cent in 2013/2014 to 7.0 per cent in 2015/2016, while Perth will drop from 7.6 per cent to 2.0 per cent.
Canberra will slow from 2.8 per cent to 2.0 per cent and Hobart will ease from 3.5 per cent to 3.0 per cent.
Darwin house prices are actually set to go backwards: growth of 6.4 per cent in 2013/2014 is forecast to give way to a decline of 2.0 per cent in 2015/2016
Only two markets are expected to improve during this period: Brisbane will rise from 4.5 per cent to 6.0 per cent, while Adelaide will climb from 3.9 per cent to 4.0 per cent.
Afirm Financial managing director Leon Spadavecchia, who made the 2014 Elite Business Writers ranking, said the lesson he learned during the GFC was to be proactive.
Mr Spadavecchia told The Adviser that brokers should actively engage with their database now so they will be front of mind with their clients during any possible downturn next year.
“We do that as part of our normal process anyway – we have certain milestones in the life of a loan where we’ll make contact with the client – but we might expedite that process to be able to get them in earlier,” he said.
Intuitive Finance managing director Andrew Mirams, who also made the Elite Business Writers ranking, said his firm had started 'planning for a rainy day' by broadening its referral networks.
Mr Mirams said it was important not only to cover multiple professions such as real estate, accounting and planning, but also to form relationships with multiple companies in those areas.
He also said brokers should expand their efforts on social media so they are as visible as possible the moment any downturn arrives.
“The broader your funnel is, the more opportunity when things change to still be able to capture business,” Mr Mirams said.
Fabrice Beillard from Australian Business Coaching said businesses that position themselves as specialists in niche areas tend to do better in downturns than generalists.
He also advised businesses to look at reducing costs that don’t directly generate revenue – but not to slash indiscriminately.
“One significant mistake people make is that the first cost they let go is their marketing cost,” Mr Beillard told The Adviser.
“This is the last one you ever want to let go of because that’s what keeps customers coming through the door.”
[Related: New Veda data hints at possible downturn]
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