Lender price war no benefit to brokers

According to The Adviser’s latest weekly straw poll, 70.6 per cent of the 211 brokers surveyed said they had not seen an increase in volumes on the back of increased lender competition.

Despite borrowers being aware of the various rate reductions being promoted by lenders, Smartmove director Simon Orbell says the majority of borrowers were still opting to sit on the sidelines rather than take the plunge into property.

“There is an element of buyer caution in the market at the moment,” Mr Orbell said.

“There is a lot of negative press out there, which is stopping home owners from listing their property. When there is a lack of properties for sale, there is obviously going to be a lack of buyers.”

Mr Orbell said while increased lender competition would not drive buyers back into the market, a rate cut would.

“I think if the RBA cuts rates, we could see more investors start to come back into the market. But, until that happens, I think a lot of potential buyers will continue to sit on their hands.”

Intouch Home Loans chief executive officer Paul Ryan agreed and said he wasn’t surprised to see increased lender competition failing to increase broker volumes.

“No amount of increased competition between lenders will replace hard work,” he told The Adviser.

“For brokers to see their volumes increase, they have to work hard. Good brokers are always busy, but that is because they work hard, they are proactive in touching base with their clients, they don’t wait for the lender price war to deliver them business opportunities.”