Regulation, cooling property prices and ongoing lending changes may seem like a burden, but they all have a silver lining for brokers with the right attitude.
Increased regulation will drive professionalism and lift the reputation of Australian mortgage broking. Customers feel comfortable with a well-regulated industry, and they will continue to vote with their feet in 2018 by choosing mortgage brokers over bank branches.
Over the next 12 months, the media lens will be trained on the Royal Commission and big bank bashing is bound to continue. Growing dissatisfaction among consumers will lead to questions. Is my bank really giving me the best deal? In this environment, brokers will thrive.
Cooling property prices
With the Sydney real estate boom now firmly winding down, first home buyers may finally have the chance to get a foot on the property ladder.
State governments have thrown their support behind first home buyers by scrapping stamp duty, lenders are beginning to release new products and incentives and rates remain low for now.
ABS figures show that the number of first home buyer commitments as a percentage of total owner-occupied housing finance commitments rose to 17.6 per cent in October 2017, the highest level recorded since July 2013.
Brokers are in the perfect position to help these customers secure their first home. In addition to finding the appropriate finance option, brokers have the opportunity to gain a client for life — and a valuable source of referrals.
Ongoing lending changes
APRA’s macro-prudential measures have had a major impact on the market over the last 12 months, and this looks set to continue into 2018.
While a broker’s job has become harder as a result, the value a broker provides to their client has increased substantially. It will become harder to borrow over the next 12 months, and Australians will be looking to brokers for help. Mortgage professionals who can stay abreast of pricing and policy changes and educate their clients through the process will continue to build successful businesses in 2018.
This year will see a range of innovative home loan products hit the market, particularly from non-bank lenders and mortgage providers operating in niche segments.
Tighter lending is creating opportunities and a new era of white label lending is on its way. Keep an eye out for fresh offerings over the next few months.
Whether you’re tech-savvy or not, the world has changed and technology is critical to running a successful financial services business in 2018. In addition to ongoing developments in aggregator software, there are plenty of new digital solutions out there to help mortgage brokers.
Make 2018 the year that you learn how to use technology efficiently. Use it to streamline your processes so that you can spend more time with your clients and working on your business, rather than in your business.
James Mitchell has over eight years’ experience as a financial reporter and is the editor of Wealth and Wellness at Momentum Media.
He has a sound pedigree to cover the business of mortgages and the converging financial services sector having reported for leading finance titles InvestorDaily, InvestorWeekly, Accountants Daily, ifa, Mortgage Business, Residential Property Manager, Real Estate Business, SMSF Adviser, Smart Property Investment, and The Adviser.
He has also been published in The Daily Telegraph and contributed online to FST Media and Mergermarket, part of the Financial Times Group.
James holds a BA (Hons) in English Literature and an MA in Journalism.
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