Vaughan Clark started his Melbourne-based brokerage in 2016 after witnessing his friends’ frustration with the mortgage process. We ask him about transitioning from an outside industry and navigating the unique challenges of Melbourne’s property market.
Why and how did you become a broker?
In 2016, I had an opportunity to step out of a corporate role and review what career opportunities there are out there. My wife said: ‘Why don't you just go back and start your own business?’
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... So after reviewing a couple of different industries, I decided to become a broker. And that was partly because [of] witnessing my family and friends’ struggle with the whole home loan process. [I thought] ‘this just seems really difficult’. They were very anxious through the whole process, [worrying about] ‘am I going to get approved or not? Can I buy that house?’
So, that inspired me to try and create a simpler, more transparent home loan experience. And with a background in finance and an understanding of how to develop a business, we decided to start Clark Finance group and focus on client education and a more personalised, engaging process.
How did you decide on which loans to focus on when you started out?
I remember being guided that, when you start off as a broker, you should do everything… commercial loans, car loans, personal loans, residential finance etc. But I actually found that we had a couple of commercial opportunities that distracted us from doing residential lending.
I lost a couple of residential loan opportunities because I wasn't focused enough on that area. So, I decided that we would not do anything else other than residential. We cut out everything.
Now, we don't do any loans other than residential (both owner-occupied and investor).
The Melbourne market has been in the headlines a lot recently because of house prices dropping. Are you finding that it's harder to settle loans there?
It's interesting because we've gone through two types of markets; It's gone from being ‘a fear of missing out’, to ‘a fear of paying too much’. People are a little bit more cautious now about what they offer, how much they pay and so forth. So, they've almost got the same anxiety in trying to purchase a home as they did when the market was running away from them…
Houses are staying on sale longer. And I think there is an oversupply because it's something in the vicinity of 35 per cent of houses that are up for sale are investors selling their properties because of all of the taxes that are involved in investment properties in Melbourne…
There is definitely an oversupply and people are more cautious about what they pay for a property and how they go through that process.
Do you have any top tips for brokers on how to improve operational performance?
Make sure that your team understands the role that they play in your organisation. Some people like to be file owners (where they own the file from start to finish). Other people like [to focus on] different segments and break it up…You don't want to put a square peg in a round hole.
I try to match the team with what they're really good at. If they're really good at what they're doing, then they tend to enjoy it and they tend to do it better and more efficiently…So it's just matching the right people with the right roles within the organisation and making sure they understand it all and providing them with the tools that help them. So whether that be Quickli, Adobe, the right CRM system, the right computer…Give people the appropriate tools to do their role and they'll do it really well.
What do you think could make broking better?
If I look at the differences in dealing with different banks, it's such an inconsistency…I think that we could have a more uniform application process so we can make it simple…
The end result is we're trying to help clients get a loan to make a purchase, to solve a problem for them. So the solution is the lender.
I just think streamlining may help us with getting a great outcome. It's really all going to be about the client outcomes. So whatever we can do on the back end to improve that is what I think the industry needs to always focus on.
Any advice for new brokers?
I think focusing on building really strong relationships with your clients and delivering value beyond the transaction [is essential].
We educate our clients so that they actually understand the process. And when clients understand the process, they actually trust you more, which I think was really important.
Always invest in your ongoing and personal development.The industry is forever evolving, so you need to be evolving in yourself. Understand what's going on around you, [as] that can affect people… The old saying was: ‘What wins on Sunday sells on Monday?’ Well, what happens on the 06:00 news on Sunday night where they talk about the housing market crashing or the housing market about to grow. Just be aware of the external influences that affect people's thought patterns about what's going on and how they feel about the environment that they're about to come into.
Know your numbers, too. If you don't know your numbers, things can run away from you really, really quickly.
Find out more about Vaughan Clark and Clark Finance Group in The Adviser's Elite Broker podcast episode below:
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