An Australian real estate listings group with international operations says brokers will play a critical role in its plans to become a home loan provider.
REA Group, the parent company of online property listings site realestate.com.au, has hired Andrew Russell to lead the group’s push into the financial services space.
Mr Russell was responsible for launching Virgin Home Loans in Australia and more recently was general manager of third-party and product distribution at Mortgage Choice.
As executive director of the newly launched REA Financial Services, Mr Russell will work on the opportunity that REA Group sees in the Australian mortgage market, with brokers set to become a 'cornerstone' of the group's strategy.
“The broker market is growing at a good speed and now represents around 50 per cent of home loans. Consumers have put their hands up and said that they do want choice when it comes to accessing home loans so we expect brokers will be a cornerstone of our strategy,” Mr Russell told The Adviser.
“There is a lot of work being done in the background and I’m looking at ways we can build capability to increase our presence in the mortgage leads space."
In June, REA Group entered into a lead generation agreement with AFG. A home loan tool on realestate.com.au has since been integrated into property searches, presenting loan options available through AFG from a range of lenders.
Mr Russell said the group will be leveraging off its partnership with AFG and exploring opportunities in the mortgage space that can be brought to market quickly.
The move into financial services also presents opportunities in the commercial lending, he added.
“With REA Group active in the commercial property space, there are finance opportunities there as well,” Mr Russell said. “We’re already meeting with potential partners who are innovative and strategically aligned to what we’re trying to achieve.
“It is still early days but we will look at opportunities to get into product distribution.”
Mr Russell believes the REA brand is strong and resonates with consumers, which he sees as integral for group as it looks to launch a range of branded mortgage products.
"The consumer research that the business has undertaken to date suggests that the people who use our sites are looking for direction and assistance in this space.
"We’re intending to offer best in class products to our consumers.
“It is a really exciting time as we explore our options and look closely at how people research and access finance now and how this might change in the future,” he said.
One of the most powerful aspects of REA Group’s venture into financial services is the potential to leverage its data insights, Mr Russell said, so long as they are used in a way that respects personal privacy and maintains consumer trust.
“The house is the epicentre of the finance transaction and as a national business, REA Group has a good understanding of what is going on in the market,” he said.
“Using that as an advantage will be useful in terms of being able to serve consumers with products that will meet their needs.
“That to me is very exciting and leveraging off the wealth of experience in the digital space will be ground-breaking.
“That to me was a big hook when coming to REA Group,” Mr Russell said.
The Australia-based group is worth almost $6.5 billion and publishes online listings and data on residential and commercial property in Australia, Europe and Asia.