MAY 2021 ISSUE 18.08
JOHN KOLENDA Fast-growing Finsure is celebrating record loan settlement volumes and an expanding broker network in its 10th year, but the award-winning aggregator also has a firm eye on future growth /14 ALSO IN THIS ISSUE… Big deal Atlas Broker duo help business owner refinance for a better deal /20 Broker on broker Madhu Chaudhuri shares her views on referral networks, turnaround times /21 Industry welcomes new appointments Meet five staff appointed to new roles at banks, non-banks and brokerages /18
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Broker training to help the vulnerable MFAA partnership trains brokers to help clients suffering domestic violence /22
Caught on camera Semper Capital hosts workshop on the secrets to commercial broking success /25
In the hot seat LendWealth broker Sam Farha talks about his new role /30
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NEWS
IN THIS SECTION
Lenders MoneyPlace to entice brokers with $80,000 loan limit /04
Aggregators Aussie’s James Symond to step down from CEO role /06
Market Returning expats contribute to property boom /10
Industry bodies FBAA urges brokers to focus on small businesses /12
Technology Fintech Square brings loan product to Australia /08
GLOBAL WATCH What’s happening in the mortgage, broking and banking world in the United States and Canada? Here’s your snapshot of the news that matters most in North America
MEDIAN US HOUSE PRICE HITS NEW HIGH AS LISTINGS DROP 29% US national median home sale price has reached a record high, according to Redfin. The brokerage’s data showed that the median home sale price jumped to a new high of US$353,000 in March 2021 – up 17% from 2020. Figures also showed that median sale prices increased year-over-year in all but two of the 85 largest metro areas that Redfin tracks – Honolulu, Hawaii, where they fell 4.7% from a year ago; and San Francisco, California, where they were down 1.6%. The largest price increases were seen in Austin, Texas (up 28%); Fresno, California (up 23%); and North Port, Florida (up 23%) – three popular destinations for remote workers. Active listings fell 29% year-over-year to their lowest level on record, suggesting low stock could in part be driving prices upward. THE
www.brokernews.com.au MAY 2021 EDITORIAL
SALES & MARKETING
Editor Antony Field
Publisher/Sales Manager Simon Kerslake
News Editor Mike Wood
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MILLIONS OF CANADIANS MISSING PAYMENTS DUE TO COVID-19 new report from insolvency practitioners Bromwich+Smith with Leger Research has found that 49% of households in Ontario and Alberta, Canada, and more than half in British Columbia, have suffered an immediate income reduction since the COVID-19 crisis began. The share of households that reported already falling behind with payments on credit cards, utilities or telecoms was 24% in Alberta and 19% in Ontario and BC. “The results are quite staggering really … the survey results make it far more real having interviewed 750 people across BC, Alberta and Ontario,” says Leger Research vice president David de Lange. Most of those struggling will reach out for government help, but almost a quarter of respondents said they didn’t know how they would adjust to a reduction in income. A
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FOREIGN BUYERS FLOCKING TO BUY AMERICAN REAL ESTATE as borders stay shut and international travel remains deeply uncomfortable, EVEN foreign buyers are still flocking to US real estate. Damon Germanides specialises in serving a foreign buyer clientele at Insignia Mortgage. In his California market, he said about 10–15% of his current volume was made up of purchase and refinance business from foreign buyers. Germanides said currency fluctuations, investment opportunities and long-term decision-making had helped spur foreign buyer interest. “The dollar has fallen, which always has a positive effect on foreigners wanting to buy US real estate, especially from Europe where currencies might be stronger. Combined with low rates, they have a really strong tailwind in that respect … now as things have started to normalise we’re seeing travellers again and real estate has picked up.”
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This magazine is printed on paper produced from 1OO% sustainable forestry, grown and managed specifically for the paper pulp industry Copyright is reserved throughout. No part of this publication can be reproduced in whole or part without the express permission of the editor. Contributions are invited, but copies of work should be kept, as Australian Broker magazine can accept no responsibility for loss. Australian Broker is the most-often read industry publication, according to independent research carried out by the Ehrenberg-Bass Institute for Marketing Science at the University of South Australia in December 2008. The research also found that brokers rate Australian Broker as the best for both news content and feature articles, followed by sister publication MPA. Overall, on all categories, Australian Broker ranks top followed by MPA. The results were based on a sample of 405 respondents who were the subject of telephone interviews.
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Karen, tennis pro
Oliver, culinary master mind
Nick, avid outback camper
Gavin, firefighter on call
Miki, gym enthusiast
Bindi, chess champion
Phil, environmentalist
A network that celebrates you
“
Powerhouse broker, mother and financial mentor.
With LNS you get the best of both worlds: The support of a team and the freedom to build your own business. We celebrate you as an individual, while offering the benefits of a strong and vibrant community.
As a single parent, Sarah knows the empowerment and peace of mind that comes with financial security. Her passion for helping people get financial extends past the 9-5 by running regular money management workshops for women. Sarah – you’re a finance wonder woman!
...PS, and when I’m not helping you build your business, I’m cheering on the Richmond Tigers in the AFL. - Brendan O’Donnell Managing Director, Liberty Network Services
Sarah, finance powerhouse
We’re more than just an aggregator, because you’re more than just a mortgage broker. To find out more about becoming a Liberty Adviser, visit liberty.com.au/LNS.
Broker and snowboarder. Whether it’s tackling snow peaks or a mountain of loan applications, Sean has a knack for navigating his way through any situation. Helping customers get financial gives him the same rush he enjoys on the slopes. Sean, we think that makes you pretty cool!
Sean, snowboard king
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NEWS
LENDERS LA MOULA TROBE JOINS FINANCIAL PANEL AT RETAINS AGGREGATOR SUPERIOR FAST RATING has retained its status as a “superior” lender, despite a year of upheaval in the financial industry. The non-bank received a 4.25-star rating from funds rating agency SQM Research. “We’re really pleased that we have the highest-rated fund in that sector. That’s a ... confirmation for our business but also for our investors about the quality of the investment selection disciplines that we put in place,” said La Trobe Financial CIO Chris Andrews. LA TROBE FINANCIAL
MORTGAGE EZY MARKS 20TH ANNIVERSARY lender Mortgage Ezy has celebrated 20 successful years in mortgage broking. Established in April 2001, it started out as a disruptor, placing itself on the side of brokers, and built a reputation for being accessible and agile. “Culture eats strategy for breakfast, and when the going gets tough, the tough get going,” said group executive chairman Peter James. Mortgage Ezy has won a number of Non-Bank of the Year titles at the Australian Mortgage Awards.
Alf Vasta, head of broker distribution, MoneyPlace
NON-BANK
“We’re really looking to help brokers to find a stop-gap solution for their clients. We don’t have any exit penalties or monthly fees” Alf Vasta Head of broker distribution, MoneyPlace
MONEYPLACE ATTRACTS BROKERS WITH MARKET-LEADING LOAN LIMIT Personal lender MoneyPlace has increased the limit on its unsecured loans to $80,000 and is encouraging brokers to diversify into this space has raised the bar on personal loans in Australia, offering a new market-leading $80,000 unsecured loan – and it is inviting brokers to enter the personal loan marketplace to take advantage of its new offer. Alf Vasta, head of broker distribution, said it was the broker channel that had compelled MoneyPlace to offer this new, market-leading product. “It’s just feedback from the broker market,” he said of the lender’s decision to set the new limit. “More and more clients are focusing on doing renovations and MONEYPLACE
things like that, tidying up their property, and there’s not enough equity in their home loans. We’re really looking to help brokers to help them find a stop-gap solution for their clients. As we don’t have any exit penalties or monthly fees, we’re really seeing it as a good opportunity. “I’ve ticked two years here at MoneyPlace as head of broker distribution, and my mantra has been positioning personal loans in the broker channel. We’re starting to make some real headway on the back of it. “We do unsecured personal loans, and we’ve just launched
$80,000 unsecured, which is the largest unsecured loan amount in the marketplace. It’s market leading. That’s pretty exciting for us … we’re trying to target clients looking to do renovations, purchase assets and things like that using an unsecured personal loan.” Vasta said brokers should be excited about getting into the personal loan marketplace because it offers them several options that their traditional mortgage business can’t, as well as the potential to increase earnings. This includes brokers converting more of their core business by helping clients who are trying to lodge a residential home loan or an asset car loan with debt consolidation. “The other thing is that it gives the broker the opportunity to increase their market opportunities and generate new business.”
Greg O’Neill President and CEO, La Trobe Financial
Faster than banks Cheaper than caveats Difficult loans • When banks can’t help •
For quick solutions call today
Catherine Willoughby
Adelaide 08 8408 0800 | Melbourne 03 9225 5189 | Sydney 02 9239 3144
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Australian Credit Licence No. 385467
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OPENING DOORS TOGETHER We’re working with you to open doors for more Aussies.
westpac.com.au/brokers
© Westpac Banking Corporation ABN 33 007 457 141 AFSL and Australian credit licence 233714.
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NEWS
A G G R E G AT O R S MONEYQUEST REACHES 100 FRANCHISES
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has announced its 100th franchise owner in Australia, capping a meteoric rise since launching as a mortgage broker franchise in 2016. The aggregator boasts one of the fastest-growing networks in Australia, with $400m in submissions per month. “We’re extremely proud,” said MoneyQuest managing director Michael Russell. He was also thrilled that MoneyQuest had been successful in recruiting financially astute former bankers and lenders and standalone mortgage brokers – they now make up 75% of current franchise owners. MONEYQUEST
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N AFG BREAKS ANOTHER LOAN LODGEMENT RECORD has announced another successful quarter for home loan applications, with lodgements breaking its previous record with a substantial annual gain of 34.32%. AFG brokers lodged $20.6bn in home loan applications over the third quarter of FY21. “Record-low interest rates, effective government stimulus packages and an improving consumer outlook have contributed to increased activity,” said CEO David Bailey. AFG brokers reported the highest gain in lodgements in NSW, where home loan applications grew by 40% annually.
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N James Symond, CEO, Aussie Home Loans
JAMES SYMOND TO LEAVE BEHIND AUSSIE CEO ROLE After six years leading Aussie Home Loans, James Symond is to step down from his role as CEO of the national broker franchise network and aggregator of the biggest names in Australian mortgage broking, James Symond will quit his position at the end of the year. Symond will leave after overseeing the upcoming merger of Aussie and fintech lender Lendi. His departure will bring to an end 30 years of service to the company, which was previously run by his uncle, founder John Symond, until he handed the reins to James. Aussie has grown massively, including stores, brokers and loans, under James Symond’s leadership. The network wrote ONE
“Aussie and the industry has been my commercial life since I was 19, and I’m incredibly proud of the legacy that John and I created” James Symond CEO, Aussie Home Loans
Commercial Loans
a record $3bn in loan lodgements last month. “Aussie and the industry has been my commercial life since I was 19, and I’m incredibly proud of the legacy that John and I created,” said Symond. “From humble beginnings Aussie has come a long way, from revolutionising and bringing healthy competition to the Australian home lending industry to where we are today with the largest retail footprint of any mortgage broker brand in Australia. “Aussie now has a national distribution network with over 220 stores, over 1,000 brokers and 300 team members, who are part of the family-style culture John and I
N successfully built over three decades.” Highlights of Symond’s tenure include the acquisition of Wizard, and Aussie’s sale to Commonwealth Bank. Launched in 1992, Aussie was a pioneer in giving consumers an alternative to the major banks. Symond started his career at Aussie at the age of just 19 and held a number of leadership roles, culminating in his appointment as CEO in 2015. An energetic and dedicated leader, Symond steered Aussie through significant challenges, including the Hayne royal commission, bushfires and COVID-19. He has also been a strong advocate for mortgage brokers. “I’ve always been proud of the broking industry and Aussie’s role in advocating for customers. Now, with over 60% of home loans in Australia provided by brokers, the industry is at an exciting new stage of growth, and technology will play a major part in this,” he said.
1st mortgage, 2nd mortgage and caveat loans
All states and territories, including regional & rural areas
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make the switch If you are considering a change of aggregator, get in touch today and speak to our business development specialists about our cutting-edge broker support solutions that help you unlock your full potential. Join Finsure today and start benefiting from our range of services. N Flexible commission structures N Intuitive aggregator software ‘Infynity’ N Ongoing business support N Personalised marketing support N Loan processing services N Third party solutions to grow revenue N Market-leading compliance support
get in touch 1300 FINSURE (346 787) www.finsure.com.au
Australian Credit Licence 384704
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NEWS
TECHNOLOGY CBA DIGITAL TOOL SAVES CUSTOMERS $481M Benefits Finder tool provided by Commonwealth Bank has helped its customers save $481m on utility bills and extra government payments. The tool, released in September 2019 as a feature of CBA’s mobile application, enables customers to access 270 government rebates and benefits, and has helped process over a million claims. NSW reported the highest number of claims at roughly 400,000. CBA customers can access benefits such as the Pandemic Leave Disaster Payment, Dine & Discover NSW, COVID Land Tax Relief and SME loan guarantee schemes. The most popular types of claims accessed by customers include unclaimed money on a federal and state level, unclaimed super, the Power Saving Bonus, Jobseeker-related payments, family tax benefits, rent assistance, and family energy rebates. THE
NODIFI PRODUCT TARGETS ASSET FINANCE BROKERS asset finance fintech Nodifi is to offer a new bespoke product to help brokers navigate the new best interest duty regulations. It represents a concerted effort to bring brokers back to asset finance after many departed due to the new rules, which reduced commissions for brokers and dissuaded many from engaging with consumer-facing asset work. Nodifi’s Alex Ventura said the product allows brokers to set fixed rates for consumer asset finance, with commission included. With BID, he said, “brokers had to dial down rates to the base rates as that is in the best interest of the consumers. When they do that, they don’t earn a commission on it”. The benefit of Nodifi’s fixed rates is that “the commission is already inclusive in what that has been dialled up to”, Ventura said. RISING
Samina Hussain-Letch, head of industry and payments, Square Australia
SQUARE TO LAUNCH NEW SME LOAN PRODUCT IN AUSTRALIA Fintech payments platform Square is making a move into the SME space in Australia, introducing its first lending product outside the US of the most recognisable fintech start-ups in recent years, Square Australia is set to enter the loan space in this country through a new financial services product, Square Loans. It will be the payment platform’s first venture into financial services, off the back of its lending product in the US. Square’s US arm has already financed over US$8bn in loans to almost half a million small businesses. “It’s our first financial services product to launch here, and the first time we’re launching outside the US,” said Square Australia head of industry and payments Samina Hussain-Letch. ONE
“The timing is very intentional because we’re now seeing businesses need to access alternative forms of lending more than ever. Coming out of COVID, businesses are in recovery mode and are often underserved. There’s often big hurdles in accessing capital, and Square is here to fix that gap. “We’ve been testing the product for the past couple of months, and we’re planning to make it available this quarter. The whole premise is to make access to capital fair and flexible … in a traditional loan application there’s loads of paperwork and often personal guarantees, for example against
a family home. We’re not asking for any guarantees for loans up to $75,000, and there’s also no paperwork involved.” Square is looking to draw on reams of client data, generated through its sales product, to help make responsible lending decisions and improve turnaround times. “We are making decisions based on the data that we have on our sellers and offering them a loan,” said Hussain-Letch. “If they choose to accept or to accept less than what we are offering, they can do that within three clicks and apply for the loan. Once they’re approved, they get the funds the next business day.” There is no interest rate on Square loans – just one fixed fee that the seller is told about up front and can be paid over the life of the loan. The repayment is based on a percentage of the seller’s daily sales.
SMALL BUSINESS PERCEPTION OF ACCESS TO FINANCE Sources: RBA, Sensis
Net balance*
“The premise is to make access to capital fair and flexible … we’re not asking for any guarantees for loans up to $75,000, and there’s no paperwork”
Samina Hussain-Letch Head of industry and payments, Square Australia
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*Net balance is the difference between the percentage of firms indicating access is relatively easy and those indicating access is relatively difficult
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TECHNOLOGY UPDATE
MAXIMISING TECH TOOLS LEVELS THE PLAYING FIELD FOR AMB
Anup Munankarmi, Head of Broker Channel, Australian Military Bank
key component of Australian Military Bank’s success in the broker market is its streamlining of key application documents and data capture with NextGen.Net’s industry-leading lodgement solution, ApplyOnline. “When we first ventured into the broker market in 2015, we were doing almost everything manually,” recalls AMB’s Head of Broker Channel, Anup Munankarmi. “Fast-forward six years and with NextGen.Net’s support we are now taking the entire application online, including all compliance requirements and all the supporting documents. “ApplyOnline integrates seamlessly into our core system; and in reality, we’re now providing a one-stop shop for pretty much all the applicant’s details,” he says. Member-owned AMB has 50,000 members across Australia. It is Australia’s longest-serving financial institution for those in the Defence community, but it’s open to everyone. “We’re a niche bank supporting Australia’s Defence community. Defence is at the core of what we do at AMB. We’re one of only three banks in Australia that can offer subsidised loans to eligible Australian Defence Force personnel,” says Munankarmi. “But while the majority of our loans are for current and former Australian Defence Force personnel and their families, we A
also work with members outside Defence and pride ourselves on maintaining a strong relationship with our members when they transition to civilian life. “We’re also a participating lender in the First Home Loan Deposit Scheme, which has attracted many non-Defence personnel to our business as we help a wider range of Australians achieve the dream of home ownership.” By upgrading its ApplyOnline offering with the ‘Supporting Docs’ service and Compliance tab, AMB demonstrated its commitment to the broker channel to offer its home loan products in a quality and streamlined way. In 2019, AMB activated NextGen.Net’s ‘Combined Industry Compliance’ tab into its ApplyOnline solution to bring the bank in line with other lenders and offer the standardised capture of responsible lending requirements expected by broker groups and brokers. “The addition of the Compliance tab and Supporting Docs has seen a drastic reduction in the amount of rework on applications,” says Munankarmi. In July and August 2020, AMB experienced considerable growth and correspondingly enabled scalability through the efficiencies offered by the Compliance tab and improved usage of the Supporting Documents service. “AMB’s uplift of technology
Steven Hudson, Customer Account Manager, NextGen.Net
with NextGen enables them to compete with larger lenders and have all the efficiencies and tools that brokers need to seamlessly write a home loan,” says NextGen.Net Customer Account Manager Steven Hudson. “From a regulatory perspective, they’re now live with the Compliance tab. That means brokers can complete all their regulatory requirements in an automated fashion. AMB is a great example of a smaller player harnessing technology to achieve substantial growth and successfully compete with the big players.” AMB has also been working hard to reduce its reliance on printed material. “Everything is online now apart from signatures, which are coming soon,” says Munankarmi. “Our broker portal is a one-stop shop, containing all the required policy documents, calculators, as well as real-time SLAs! “ApplyOnline enables us to track applications, improve our response times to brokers and manage SLAs, reduce rework on applications and communicate with our brokers via backchannel messages, which allows us to provide responses to the broker through a series of clicks in that platform.” By optimising available tech tools, AMB has seen significant volume growth through the broker channel. Now that it has the facility
to scale with these tools, it is looking to expand and incorporate additional broker groups. “We are definitely looking to grow,” confirms Munankarmi. “As demand for our niche has increased, we’ve increased our broker team to better serve our brokers. We’ve been approached by a number of new aggregators, so expect our presence to continue to expand. We want our products to be available to most brokers in Australia. “We get regular updates from NextGen about enhancements to make the broker experience better, which is always front of mind for us. We strive for a 24-hour SLA and we have a team to do the pre-assessment work to make the whole experience for the broker a lot easier.” Noting that AMB was an early adopter of ApplyOnline’s dynamic compliance solution, Hudson says he is also working closely with the bank, utilising NextGen.Net’s Industry Benchmark service “so they can see where they sit in respect to market standards and if necessary adopt further changes to reduce their time to yes”. “I get a great deal of satisfaction providing plug and play access to tools for AMB. They always ensure that the right product is being suggested to the client, and our technology enables them to compete at the efficiency level of the big banks,” says Hudson.
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NEWS
MARKET RBA MONITORING BOOMING HOUSING MARKET are closely monitoring the housing market as it continues to rise, according CommSec’s latest economic insight. CommSec senior economist Ryan Felsman said the Reserve Bank had flagged the potential challenges of rising dwelling values. CoreLogic figures for March showed dwelling prices hitting their highest monthly growth in 32 years at 2.8%. The RBA said the housing market was being “watched closely”. If prices continued to rise it would “present renewed challenges for housing affordability for lower income households”. REGULATORS
MEZZANINE FINANCE ON THE WAY BACK — FINANCIER property boom is bringing mezzanine finance back into the broking industry, according to commercial property financier Stamford Capital. The company has noted a significant upsurge in secondary finance deals as major banks return to the property development market after several years on the sidelines following the GFC. Stamford Capital joint managing director Mike Hynes said mezzanine finance or a second mortgage is a debt instrument used in project financing and for existing assets. “It’s a tool most often used by developers that want to be capital-savvy.” AUSTRALIA’S
Peter Koulizos, chairman, Property Investment Professionals of Australia
RETURNING AUSSIE EXPATS FEEDING NATIONAL PROPERTY BOOM Australians living overseas who have returned to their home country because of the pandemic are contributing to record property prices, says the peak body for property investors are fuelling Australia’s property boom, according to industry body Property Investment Professionals of Australia. It is thought that over 400,000 Aussie expats have come back since the pandemic began in early 2020, bringing with them cash earned elsewhere in the world. PIPA chairman Peter Koulizos told Australian Broker about the so-called ‘expat factor’. “The expat factor is where we have a lot of people that used to live in Australia, that may have gone overseas for work, who as a result of COVID-19 have decided to return to Australia,” he said. EXPATS
“For many of them, they weren’t going to be working overseas forever, and COVID was a catalyst. Rather than going home later, they’ve said that they’re coming home now. “For those people living in more expensive real estate markets, like London, Hong Kong and other expensive parts of Europe and Asia, who have been earning good money, they might have liquidated their assets there. “When they come back to Australia, it looks relatively inexpensive compared to where they had been living, so they’re ready to pay that little bit extra to live in very desirable areas of our
capital cities,” Koulizos said. He said the expats could be seen as replicating the foreign investor surge that was present in Australia a few years ago, in essence bringing foreign capital into the market, albeit this time via Australian citizens. “It’s like when we were complaining that foreign investors were driving property prices up,” he said. “Outside money, particularly high-income earners, were viewing Australia as a much more affordable place to invest, so they were buying here. Then the government put in a foreigner’s purchase levy, and that slowed things down. “We’ve probably seen the best of it [the expat factor] because I can’t see people continuing to come back to Australia as a result of COVID. Even though COVID isn’t over, the worst of it certainly is. It provided a catalyst for prices moving up.”
“When [expats] come back to Australia, it looks relatively inexpensive compared to where they had been living, so they’re ready to pay that little bit extra” Peter Koulizos Chairman, Property Investment Professionals of Australia
STEEP RISE IN CAPITAL CITY HOME VALUES Source: CoreLogic Property Market Indicator Summary, week ending 18 April 2021
Monthly change in home value index – aggregate of five capital cities 3.0%
Monthly change in index
160
Dwelling index
150 2.0%
140 130
1.0%
120 110
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ANZ Financial Wellbeing
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NEWS
INDUSTRY BODIES HOMEBUILDER EXTENSION WELCOMED BY INDUSTRY Housing Industry Association and Master Builders Australia have welcomed the federal government’s decision to extend the construction start requirement for the HomeBuilder grant to 18 months. HIA managing director Graham Wolfe said members had been severely impacted by global supply constraints and labour pressures, while there had also been delays in finance approvals, planning and building approvals and land titles. Master Builders Australia CEO Denita Wawn said thousands of HomeBuilder applicants could now breathe a sigh of relief. THE
CUSTOMER-OWNED BANKS RANKED BEST BY FORBES banks have topped the Forbes list of Australia’s best banks, taking up four of the top five places. Newcastle Permanent was named the second-best bank in Australia, with ING in the top spot. Greater Bank, Heritage Bank and Beyond Bank were also in the top five. Customer Owned Banking Association CEO Michael Lawrence congratulated members on dominating rankings for a second year. “Instead of paying shareholders, our members reinvest profits back into benefits for customers through lower fees, better interest rates and time-saving innovation,” he said. CONSUMER-OWNED
“Brokers have an ability to access a broad range of lenders and lending products that can tailor-make a solution for the SME” Peter White Managing director, FBAA
Peter White, managing director, FBAA
FBAA ENCOURAGES BROKERS TO DIVERSIFY INTO SME SPACE Brokers add another string to their bow by educating themselves and branching out into the small business market, according to the FBAA managing director Peter White has told Australian Broker that mortgage brokers are missing a trick by not giving themselves the option of engaging in with SMEs. “Brokers need to upskill their knowledge sets to ensure that they can adequately assist the small business person,” said White. “A lot of brokers are proactively doing this and taking further courses so that they can deepen their knowledge and understand how to read balance sheets and profit/loss statements. Most people can read P/L statements, but most don’t really understand the detail within a balance FBAA
sheet and how that affects the viability of a business. That’s an important piece. “We’re seeing a lot of brokers within the industry doing specialised courses in SME lending, and that’s the key thing that they need to do. In my past, both as a broker and as a lender, I used to specialise in business and commercial lending, and unless you can quickly build that rapport with the business person, they’re not going to do business with you. If you don’t understand their business and their financials, you’ll lose them pretty quick.” White said brokers needed to educate themselves and once up
to speed they could thrive in the SME space by transferring their skills over from mortgages. “Brokers have an ability to access a broad range of lenders and lending products that can tailor-make a solution for the SME,” he said. “That becomes critically important. Most of the small business people are using the banks, and that might not be the most appropriate style of lending for them. A broker, armed with the right knowledge, could turn around and give them lots of options that might be far more suitable. “Brokers have only a small penetration in the SME space in terms of market share, and the banks still hold the major domain. That’s where the opportunities lie. Brokers just need to be aware of the client, what their business is and what the opportunities are.”
EXTENDED HOMEBUILDER SCHEME: KEY FACTS Source: Australian Treasury
The federal government has extended the construction start requirement from 6 to 18 months for all existing applicants who signed contracts between 4 June 2020 and 31 March 2021
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More than 121,000 people have applied for the HomeBuilder grant, which is expected to support $30bn worth of residential construction
Grant applications closed on 14 April 2021, but applicants have until 30 April 2023 to submit all supporting documentation to their state or territory revenue office
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ARE YOU A LEADING EMPLOYER IN THE MORTGAGE INDUSTRY? Australian Broker’s sister publication, MPA magazine, will uncover the absolute best mortgage employers for their inaugural Top Mortgage Employers report. Open to all organisations within the Australian mortgage industry, from large national mortgage brokerages to local retail agencies. Top Mortgage Employers will recognize companies based on the evaluation of several metrics, including culture, benefits, employee development and more.
NOMINATIONS OPEN 10 MAY 2021
For more information, visit www.mpamagazine.com.au
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COVER STORY
BROKER INNOVATIONS KEY TO BRIGHT FINSURE FUTURE Finsure is not resting on its laurels despite breaking loan settlement records and rapidly expanding its broker network in 2020. The award-winning aggregator wants to maximise new technology to achieve further growth
FINSURE AT A GLANCE
Launched in 2011
Office locations • Sydney • Melbourne • Perth • Gold Coast Loan book ($50bn as at Dec 20)
2020 settlements ($20bn)
Dec 20 settlements of $2bn
Broker numbers 1,910 (as at Dec 20)
Infynity CRM for broker support
Broker Academy for new-to-industry brokers
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broker aggregator Finsure has plenty to celebrate in 2021, its 10th anniversary year. The company, which launched in Sydney in 2011, reached monthly loan settlements of $2bn in December for the first time, while its loan book passed the $50bn milestone. Finsure has a growing network of 1,910 brokers, reflecting a 15% increase year-on-year; recently launched its new branding and logo; and is constantly improving its CRM platform, Infynity, with new tech partnerships. Finsure managing director John Kolenda spoke to Australian Broker about the aggregator’s recent successes and its exciting plans for the future. “I am very proud of all we have achieved over the past decade, particularly in 2020 and this year as we took the economic impact of the COVID-19 pandemic by the horns,” Kolenda says. “Since we started trading in 2011, Finsure has become one of the fastest-growing aggregation businesses by offering a diverse lending panel, flexible commission models, our Broker Academy, innovative marketing solutions and lead generation, plus comprehensive mortgage broker support services.” Kolenda says Finsure is fortunate to have been recognised with industry awards over the past decade and was recently crowned Best Mortgage Aggregator at the Australian Lending Awards for the second year in a row. “To be acknowledged with this top industry award is a great testimony to the contributions of all our staff, their tireless efforts and achieving consistently great results MAJOR
year-on-year, including consistently reaching $2bn in monthly settlements, while our loan book surpassed the $50bn milestone.” Broker recruitment has also been a strong point for Finsure, with its network now approaching 2,000 brokers. Its leadership structure and sales team was also bolstered by the appointment of new state managers and business development managers to support its expanding broker network. “We started 2021 with dynamic and contemporary new branding and logo to more accurately reflect Finsure’s position in the market as a leader in providing cutting-edge broker support.”
“Another interesting aspect that has occurred during the disruptions brought on by COVID-19 is that households appear to have changed their spending habits,” says Kolenda. “Many people have diverted funds that would have typically been spent on travel, particularly overseas travel, and entertainment into improving their homes or even upgrading their homes.” Lending for renovations has increased, and parts of the domestic economy are rebounding better than expected, while other sectors remain subdued due to COVID’s impacts. “This pandemic event is unlike any other in history, and this is evidenced by the disparity in
“We are always there to help our brokers during challenging times and ultimately to support them whenever we can” John Kolenda, managing director, Finsure Group Property market boom Kolenda says despite the global pandemic devastating many businesses and causing a jump in unemployment, housing markets in Australia have proven resilient. “In some parts of the nation property prices have even skyrocketed. The outlook for residential property for most of the country is encouraging given the positive indicators from consumer confidence, auction clearance rates, falling loan deferrals, and lenders keen to write new business as record low interest rates continue.
economic results across various industries. Much depends on the impact of the vaccine rollout and the return of pre-COVID travel both in Australia and overseas, but for the residential real estate market the outlook remains positive.” Tech enhancements During the coming months, Finsure will be rolling out a brand-new Client Centre for its broker network. Kolenda says this will feature a number of new improvements. It will provide brokers’ customers with their own accounts to complete
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In partnership with
John Kolenda, managing director, Finsure Group
an online customer information form; allow customers to upload documents directly into the system; show the loan details and application status; offer a chat service to keep in direct contact with the broker; and give brokers the opportunity to cross-sell other services to their clients and increase their revenue base. “The Client Centre links all the customer data directly to the broker’s account in our marketleading customer relationship management platform Infynity CRM, ultimately speeding up the application process and allowing brokers to focus more on loan selection instead of chasing customers for information.”
Infynity has been a significant boost to Finsure’s service proposition for brokers, says Kolenda. “It is the most up to date CRM in the market, with groundbreaking technology that streamlines workflow, has supported brokers since the introduction this year of BID, and automates time-consuming tasks. “Infynity has been integrated with various platforms such as NextGen.Net’s ApplyOnline, which aims to reduce the duplication of documentation uploads in a bid to reduce application times. Finsure has also formed a partnership with software provider Drive IQ to boost the digital asset finance offering to our broker network.”
Broker market share Kolenda says he expects the broker market share, currently at 60.1%, will keep growing, and certainly 70% is achievable. “The COVID period has been challenging for all industries, and the broking sector is no exception. From a Finsure perspective, the adjustments we had to make during lockdown periods when we had to temporarily close the Finsure head office and management and staff worked from home have been inspiring. “We were always able to maintain communications with our broker network. With interstate travel restricted, training and personal development days were conducted
online via webinars. We had regular online meetings and even socialised on Friday afternoons via video conferencing platforms. I think it enhanced our culture.” Personal contact with Finsure brokers was also maintained during these challenging times, something Kolenda described as being of paramount importance and “a big part of our culture”. “We have gradually returned to normal with personal development face-to-face again, but a lot was learnt from those adjustments we had to make. Brokers through COVID have demonstrated their adaptability to challenging situations, which will hold them in good stead as they continue taking a www.brokernews.com.au
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larger share of the mortgage market. “Brokers have also quickly adapted to the introduction of BID, which helps them differentiate themselves more from direct channels and further increase their market share, which is at an all-time high and will continue to grow further and follow other international markets, which are over 80%.” Finsure’s broker services So, what does Finsure do differently from other aggregators? Kolenda says Finsure brokers can get all their business needs addressed under the one roof. “For example, Finsure’s Broker Support Service takes away time-consuming data entry tasks when processing applications on behalf brokers after the provision of basic information. “Finsure’s Credit Concierge service also benefits brokers by performing the ‘heavy lifting’ of research relating to where to lodge hard-to-place or unusual deals. Also, together with BDMs and credit coaches, Finsure’s business coaches provide vital broker support by assisting with marketing strategies, business planning, goal setting and mentoring.” Compliance continues to be a major focus for the broking industry and Kolenda says Finsure is leading the way by using compliance as an enabler rather than as an inhibitor. “Our compliance team can take immediate action when they identify that a broker is not following the framework in instances such as failing to upload minimum required documents or underquoting living expenses,” he says. “Importantly, our early intervention strategy allows the broker the chance to change their behaviour and ensure their mistake is not repeated before it’s too late. No other Australian aggregator is taking this approach. Finsure is leading the way in turning attitudes to compliance away from after-the-fact detection and firmly towards prevention.” Broker development Education and professional development of brokers, as well as support with diversifying into commercial and asset finance, are crucial aspects of an aggregator's role. “Finsure has been working on leveraging the growth in our business to further improve our service proposition to brokers, particularly through education and personal development,” says Kolenda. The aggregator prepared for BID by developing a market-leading 16
solution to ensure brokers comply with the changes and provide their customers with a professional and innovative solution, ultimately making their job easier. This process was assisted by unlocking more features in Infynity, such as by developing the Infynity app store that offers a whole range of integrated services to brokers. “This initiative truly adds value for our brokers, because rather than including a range of pre-selected integrations as part of their service fee, brokers are free to choose which applications or services best suit their business,” Kolenda says. The integrated services include CoreLogic property reports; ActivePipe – a third party provider of automated email services; Client Centre integration providing for online documents/fact-find for customers and enabling them to send applications to their broker electronically; Allianz general insurance, allowing brokers to offer car and home insurance at the click of a button; custom website packages; personalised public relations services for brokers, and SMS broadcasting. “Our brokers are further assisted by Finsure through the digitisation
Supporting female brokers “We held our inaugural Women in Finsure event in Sydney in 2018 to coincide with the worldwide celebration of the political, social
“The Client Centre links all customer data directly to the broker’s account in our market-leading CRM platform Infynity, speeding up the application process” John Kolenda, managing director, Finsure Group of key compliance documents,” Kolenda says. “Finsure’s digital credit guide displays the top five lenders used by a broker and provides an updated list of all accredited lenders, helping to meet an important obligation.” Dedicated Credit Coaches at Finsure provide additional support for brokers, helping them to workshop, structure and place deals. Kolenda says for brokers looking to diversify their services and increase their revenue base, Finsure will be hosting its Commercial & Diversified Finance Summit in Brisbane this year, delivering content from Australia’s leading experts. Held in person across two days, the flagship event complements the regular masterclasses held throughout the year (both digitally and in person).
and economic achievements of women on International Women’s Day,” Kolenda says. “NSW Premier Gladys Berejiklian spoke at the event and we have regularly staged Women in Finsure events around the country in recent years.” The push for gender equality and promoting women’s rights has benefited the whole community, says Kolenda, particularly industries such as financial services. “Finsure has always proudly pushed the boundaries since it was established in 2011, initially by disrupting the traditional mortgage broker industry and now by proactively promoting equality, opportunity, diversity and inclusion of women within our great industry. “We are proud to note that since 2017 the number of female
brokers in our network has almost doubled from 17% to 31%, while in Queensland the female representation is even higher, at 35%.” Lender turnaround times Slow loan application turnaround times have been a sore point for brokers, with the problem getting worse during COVID-19. “When our brokers’ customers face urgent time frames, Finsure’s intuitive CRM system ensures the lender selection is matched appropriately, based on current turnaround times,” says Kolenda. “We are always there to help our brokers during challenging times and ultimately to support them whenever we can. We work hard to keep our brokers informed about what lenders are doing, while maintaining strong customer relationship management systems and service level agreements. “Preparing for the introduction of BID at the start of this year and changes to responsible lending has also sharpened up Finsure’s systems, as has adjusting to the structural shift in consumer behaviour brought about by the COVID-19 pandemic.” There is no doubt the future looks bright for Finsure. “We look forward to pushing ourselves to greater heights and continuing to challenge the norm, while remaining focused on making a positive difference to the lives of our brokers, innovating, challenging and breaking records.” AB
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THE CHOICE IS YOURS WITH
DECEMBER 2020 ISSUE 17.24
YEAR IN REVIEW COVID-19, a recession, bushfires and floods – 2020 threw up some monumental challenges. We asked industry leaders to look back on the year and at how 2021 is shaping up /14 ALSO IN THIS ISSUE… Big deal How Ray Ethell helped a financial adviser consolidate his debt /20 Real estate spotlight Darwin’s house prices are rising faster than in other capital cities /26 Tech partnership to speed up loans Finsure Group has partnered with fintech illion Open Data Solutions to provide a new integrated service for brokers /22
Brokers take on bankers in cricket The inaugural Bankers vs Brokers Twenty20 cricket match in Perth raised funds for the McGrath Foundation /23
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Restoring brokers’ confidence Wealth Today’s Keith Cullen suggests brokers hard-hit by regulation changes should diversify the services they offer /25
In the hot seat From restaurants to finance: GM Capital Solutions director Andrew Soo /30
9/12/2020 11:01:04 AM
MAGAZINE The only independent magazine dedicated to mortgage industry news, opinion and analysis
WEBSITE Breaking news, in-depth profiles, features, online forum and Australian Broker TV
E-NEWSLETTER Daily news service delivered straight to your inbox every morning
SCAN TO LEARN MORE
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SECTOR APPOINTMENT S
LEADING INDUSTRY FIGURES TAKE ON NEW ROLES The finance world is a fast-changing one, and it can be hard keeping track of career moves. Meet the people appointed to new positions in the world of banking, lending and broking
Will Keall Marketing outcome owner, Bankwest Will Keall has recently joined the brand and marketing team at Bankwest as marketing outcome owner for the home buying product category. In his role, he will be overseeing the development of marketing campaigns promoting Bankwest’s home loan propositions. Keall says he is honoured to be working with such an established and respected organisation and brand as Bankwest. “Bankwest is one of Australia’s longest-established financial institutions, having played a significant role in the lives of customers and communities for more than 125 years, and it’s a privilege to be a part of that,” he says. Keall was previously head of marketing at Sydney-based non-bank lender Resimac, where he was heavily involved in the consolidation of the Resimac and Homeloans brands and was instrumental in the relaunch of Resimac’s direct channel under homeloans.com.au. He says he is excited to be working in such an innovative and customer-centric organisation. “There is a genuine customer-first culture at Bankwest, which makes you feel you’re actively contributing to the financial wellbeing of customers. The enthusiasm towards continually improving customer and broker experiences is inspiring. “There’s a history of innovation, from the drive-in bank branches of the last century to the Bankwest Halo payment ring of today. “Whether the initiatives are big or small, you can feel the collective drive to deliver simple solutions to the issues that matter most to customers.” 18
Amanda Liszewski Lending specialist, Better Homes and Gardens Home Loans Lending specialist Amanda Liszewski has been appointed to lead Better Homes and Gardens Home Loans. Liszewski has almost 20 years’ experience in the financial services industry. After starting her career as a stockbroker working for top-tier firms, she transitioned to mortgages. Her career has gone from strength to strength, and she was recognised with a nomination as a finalist in the 2018 Australian Mortgage Awards
Aligning the business with some of the largest and most reputable developers in Australia is a key initial focus. These partnerships support brokers with genuine referrals as well as allowing for combined solutions to be brought into the market by aligning properties with broader finance solutions. Liszewski is also passionate about supporting key charities such as KidsWest that share common values and enable a genuine connection with the community that makes a real difference. The home loans business is
“Given the difficulties that SMEs experience in obtaining funding, the Prime Capital offering was something that really excited me” Steve Sampson, chief commercial officer, Prime Capital Young Gun of the Year category. Liszewski prides herself on achieving premium results for her clients and helping them meet their personal goals. “At Better Homes and Gardens Home Loans, we believe our clients can ‘expect better’ when looking for the right loan solution, and believe our products and service proposition will deliver a genuine difference,” says Liszewski. “Every client is unique, and we not only look at how we can help them now but also how we can set them up for the future. Rather than having a transactional approach, the team at Better Homes and Gardens Home Loans are committed to building a relationship with our clients to be able to cater to their unique needs.”
expanding its reach. There are opportunities for brokers to join the brand which is part of the Better Homes and Gardens Real Estate network, with offices in NSW, Queensland, Victoria and South Australia. Steve Sampson Chief commercial officer, Prime Capital SME lender Prime Capital has appointed industry veteran and the former head of third party at Bank of Sydney, Steve Sampson, as its chief commercial officer. Sampson has been involved in the third party broker business for more than 20 years. His remit at Prime Capital is to increase the distribution
of the company’s fast and simple loans through the Australian aggregation network. “We’re delighted to welcome Steve and excited with how his extensive industry and aggregator experience will help us assist more SMEs to find loans where the banks can’t or won’t,” says Prime Capital CEO Paul Scanlon. “I’ve taken careful consideration in my next career move, and given the difficulties that SMEs experience in obtaining funding, in particular following the COVID-19 pandemic, the Prime Capital offering was something that really excited me. After meeting the team and seeing their passion for this space, my decision was easy,” says Sampson. Established in 1997, Prime Capital provides specialist mortgage products for SMEs, the self-employed, nonresidents, investors, SMSFs and construction facilities. Prime Capital works only with accredited mortgage brokers and has settled more than $2bn right across Australia. Melanie Cochrane Non-executive director, SocietyOne Originally from the UK, Melanie Cochrane completed her Business Studies degree at Brighton University and is a graduate of the Australian Institute of Company Directors. Cochrane is now a global executive with more than 25 years’ experience in financial services. She has a diverse background in different cultures and in leading B2B and B2C businesses in the US, Australia and Asia. In her role as American Express general manager, merchant services for the Asia-Pacific, Cochrane delivered double-digit growth and a threefold increase in Net Promoter Scores. Previously, she led the Asia-Pacific’s corporate payments
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From left: Melanie Cochrane, (SocietyOne), Mitchell Stanmore (Azora), Steve Sampson (Prime Capital)
business, as well as the Global Digital Servicing Transformation Program. Cochrane has led large-scale global digital transformation programs, innovative digital payments, and third party partnerships across Australia and Asia. She’s a true customer champion, delivering advocacy programs such as Amex’s Shop Small. Throughout her career, she has also driven diversity and inclusion initiatives, including as founding sponsor of the Amex PRIDE network, and as a gender diversity leader. Cochrane served on the board of American Express Australia Ltd during a critical period of regulatory change and was most recently appointed independent non-executive director to the board at SocietyOne, one of Australia’s leading digital finance platforms. She brings to the board a true passion for driving change and digital customer innovation, aligning to SocietyOne’s DNA as a truly customer-focused digital finance platform. Cochrane’s financial services experience further supports SocietyOne’s growth strategies. “I am thrilled to be joining the board, and I look forward to sharing my experience with the team and contributing to their growth journey. It’s a very exciting time for SocietyOne,” says Cochrane. Mitchell Stanmore NSW/ACT asset and equipment finance BDM, Azora Home loans, car loans and asset finance lender Azora has appointed Mitchell Stanmore as its new asset and equipment finance business development manager representing NSW and ACT.
From left: Amanda Liszewski (Better Homes and Gardens Home Loans), Will Keall (Bankwest)
“I am thrilled to be joining the board, and I look forward to sharing my experience. It’s a very exciting time for SocietyOne” Melanie Cochrane, non-executive director, SocietyOne Stanmore will be responsible for supporting Azora’s rapidly growing presence in Australia’s small business lending space and helping drive brand awareness and product knowledge to further expand Azora’s broker network. He will work closely with new and existing partners to help deliver on Azora’s promise of delivering fast, flexible and customer-focused outcomes for Australian SMEs. Stanmore brings extensive
knowledge of SME lending and a proven track record in the industry to his new role. Prior to joining the Azora team, he worked in the field for more 10 years in various roles, including business and residential/commercial broker and business development in SME/cash flow lending and asset finance. Stanmore was previously a BDM at GetCapital and most recently held the position of partnership manager (NSW/ACT) at aggregator
National Mortgage Brokers. “I’m thrilled to be joining Azora at this time, and I’m very excited about the direction in which we’re heading,” says Stanmore. “Azora’s fresh and common-sense approach to asset finance, supported by its highly flexible lending criteria, fast turnaround times and strong technology backbone is what really drew me to Azora. “Azora is made up of highly experienced finance industry professionals with ambitious growth plans. Growth in the last six months has been very promising. “We don’t want to be another run-of-the-mil lender and want to make a real difference. We value our broker relationships and will continue to work closely with them to ensure our product offerings and application and approval processes stand out from the pack. We are constantly evolving”. AB www.brokernews.com.au
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PEOPLE
Have an interesting deal? Have a particularly difficult or interesting deal? Why not share it with us? Email:
antony.field@keymedia.com
BIG DEAL Melbourne-based Atlas Broker specialises in equipment and property finance. Brokers Matthew Atkin and Sean Lester helped a business client who was frustrated by their current bank and wanted to refinance to a more progressive bank that better understood the needs of the business THE FACTS
Client Male director of a company in business for 10+ years
Loan size $20m
Goal To refinance and change his banking relationship
Location Multiple locations across Australia
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THE TAKEAWAYS
There were a number of lessons learned or reinforced. To start with, Atlas has a long-held view that we need to be in regular structured contact with our core clients. We used this process in this case to ensure we were able to understand our client’s pain points. We were able to uncover the client’s dissatisfaction with their current funder and assist with providing a solution. This has reinforced our views around the importance of an ongoing relationship, as you can’t help a client if you are not having regular dialogue. We also believe in asking lots of questions. Often the client’s bankers are not asking these questions and the client can feel frustrated. This lets the client you know you are interested and care about their business. Most clients are
Working in teams helped get this deal done. Ideas often come from conversations, and these ideas enable us to provide better solutions to our clients
Matthew Atkin Managing director, Atlas Broker
THE SOLUTION
Judo was very proactive from the beginning. We had multiple face-to-face
Aggregator Consolidated Operations Group
meetings and Microsoft Teams meetings to work through the client’s needs and come up with a solution that could work for both parties. The client kept reinforcing the fact that they were frustrated by their current banker’s lack of understanding of their
THE SCENARIO
Atlas Broker had been working with this client for eight years, assisting with their CAPEX program. The business has a variety of equipment finance needs, so we have regular discussions around their upcoming requirements. The types of equipment they purchase vary from forklifts to prime movers and production lines, so they are a very interesting client to work with. As part of our regular catch-ups, we ask about the client’s other finance and insurance needs. These can include equipment, property, insurance premium funding or cash flow lending. The client advised us that they were not happy with their current bank, and they wanted to refinance to a funder that was more closely aligned with their values. They asked if we could help them refinance with a progressive bank that was willing to sit with the owner, understand the journey, and then work with the business to help make it happen. The client has a very involved structure, with multiple entities. At Atlas Broker, we often work in teams on these larger clients as we find it allows us to constructively workshop deals to find a solution that will benefit the client. It was through this process that we identified Judo Bank as the right partner for the client.
Lender Judo Bank
more asset finance purchases to follow in the coming year. Judo was fantastic to work with. Any refinance process will create a number of hurdles, but it was Judo’s ability to take a commercial position on the information provided that enabled as to keep moving through the process. We have continued to work with Judo and the client very closely, and the relationship is working well.
Sean Lester Broker, Atlas Broker
business and lack of interest in working through the client’s plans. Judo was very keen to engage with the client, and meetings were held with a number of very senior people to make sure everyone understood the road forward. As the client’s broker, we were also involved in these meetings as we are often the bridge between the client and the funder; and given our understanding of both parties were able to add value throughout the process. We also engaged heavily with the client’s accountant. It was important for the accountant to be comfortable with the solutions provided. The solution we presented to the client involved multiple working capital solutions for different trading entities, the refinancing of commercial properties, the refinancing of existing asset finance debt, and approval of a line of credit for
really happy to talk about their business, as they are proud of it. It’s important to communicate regularly with the funder and ensure their questions are addressed by sourcing the appropriate information in a timely manner. Sometimes we forget as brokers that our funders are also our partners, and the more we can help, the easier it is for them to make decisions in our clients’ favour. Understand the deal is also key. Our understanding of the client gave Judo the confidence to keep moving forward with us to get the deal finalised. Finally, working in teams helped get this deal done. Not many broking houses share this view, but ideas often come from conversations, and these ideas enable us to provide better solutions to our clients. We will continue to do this where appropriate. AB
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PEOPLE
Do you have a question for our broker mentors? Email your question to:
antony.field@keymedia.com
BROKER ON BROKER
A mortgage broker since 2006, Madhu Chaudhuri runs Sydney brokerage Finance & Mortgage Solutions. The MFAA 2018 Residential Finance Broker Award winner and former architect answers questions about referral networks, diversification, loan turnaround times and market share
What’s the best way for mortgage brokers to build a referral network? referral network is an A The organic process. It can go from attending Rotary fundraising barbecues where you meet the community, to children’s school fetes. It’s very important to be true to your passions so that when you meet people you are going to invest in meeting them, and once they trust you, business just keeps coming. I am always looking to refresh and grow my referral partners – markets change and it’s very important to be front of mind by attending as many public get-togethers as possible, because that soft touch of networking in similar circles is very reassuring to partners that you are trustworthy.
Q
How do you keep clients happy if lenders are taking a long time to turn around their loan applications? Being up front about the best A interests duty and the fact that you are going to a lender who is closest to the client’s preference, and explaining that there is no timeline expected as currently the service level agreement keeps moving. It’s about understanding that if it is a refinance it may be OK, but explain clearly that a purchase may be lost going to certain lenders with SLAs that are blown out. It is very disappointing to see that whilst the broker market has helped retain the competition in the market with
Q
small and niche lenders who are well supported by brokers, we are increasingly on the back foot, with different turnaround times between branches and brokers in many banks. The market may change with fintech and private lender panels increasing. Brokers are at a record market share of 60.1%. How can the broker industry further grow market share and educate the public about the benefits of using a broker? I started broking in 2006 when A the market share was less than 30%, and whilst we continue to have channel conflict and bad SLAs in the broker segment, the broker share will grow because, one, we are constantly educating ourselves, and two, we are trying to help the client have a better financial outcome. This is because we work with several specialists in our team who educate and help the client make better choices.
Q
What advice do you have for brokers wanting to diversify from residential into commercial? Commercial broking is as A simple as learning to do more of the self-employed residential home loans. Give it a try and you will be surprised how easy it can be. The only thing is that it does not simply work on loan-to-value ratios; it also works on understanding industry segments and risk mitigation. AB
Q
Madhu Chaudhuri, director, Finance & Mortgage Solutions
“Broker share will grow because we are constantly educating ourselves and trying to help the client have a better financial outcome”
PITSTOP MENTORING Are you new to the industry, or simply keen to learn from experienced brokers who have words of wisdom to share? This is your opportunity for pitstop mentoring! If you have a question you’d like a senior broker to answer, contact us and look out for an expert answer in a future issue.
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PROFESSIONAL DE VELOPMENT
TRAINING BROKERS TO HELP VULNERABLE CLIENTS
Brokers are experts on financial matters, but what happens when their clients face domestic violence? To help train brokers on how to handle situations like these, the MFAA is partnering with Accidental Counsellor, whose CEO, Cutty Felton, talks to Australian Broker about what the program will offer
violence is a scourge on society, and the MFAA wants to help the finance broking community raise awareness, reduce stigma, and increase the safety of customers when it comes to family and domestic violence. In 2019, the Banking Code of Practice was updated to include appropriate processes to identify and respond to customers in vulnerable circumstances. Sadly, 2020 saw an increase in people living in vulnerable circumstances, including domestic and family violence, which spiked during the year. Starting on 4 May, as part of the MFAA’s social responsibility initiatives, the association will be running 2.5-hour sessions with a focus on this vulnerability. Developed and delivered by Accidental Counsellor CEO Cutty Felton, the training sessions will focus on educating brokers so they can assist customers who are experiencing domestic and family violence. Cutty Felton spoke to Australian Broker about what the sessions will offer, the need for greater sensitivity and compassion, and what inspires her to raise awareness of these vitally important issues. DOMESTIC
you tell us what brokers Q Can can expect from Accidental Counsellor’s upcoming training sessions on Customers in Vulnerable Circumstances? What we will be looking at is A increasing awareness around the different factors of vulnerability, particularly the ones that are highlighted in the Banking Code of Practice. There are, of course, a number of different vulnerabilities 22
– mental illness, physical disability, age-related impairment – but the one aspect of vulnerability that we will be concentrating on the most in this upcoming series is domestic and family violence, financial abuse and elder abuse. We will also have a look at the meaning of ‘coercive control’, which is terminology that a lot of people may be hearing at the moment but not be too clear on identifying. So, it will be very much around that aspect of vulnerability and how it relates to brokers in terms of the provisions of the Banking Code of Practice. What was the thinking behind changing the scope of the program and focusing in on domestic and family violence and that area of vulnerability? We felt that, having provided the A skills and frameworks to respond to people experiencing challenges in the Accidental Counsellor sessions over the past two years, we would now extend brokers’ knowledge and ability to better identify potential domestic and family violence situations, particularly because there is a requirement within the Banking Code of Practice to have that awareness of domestic vulnerability. We are not for one moment asking brokers to become counsellors or therapists, we are not asking brokers to become experts or investigators into any of the fields of vulnerability, but there is a requirement that we all respond with sensitivity, with compassion, and that we take extra care when our customers are in vulnerable circumstances. Of course, we need to recognise what that in fact means before we can really comply with our obligations in terms of the
HOW COMMON IS FAMILY, DOMESTIC AND SEXUAL VIOLENCE IN AUSTRALIA? Source: Australian Government: Family, Domestic and Sexual Violence in Australia: Continuing the National Story 2019; ABS 2017
1 in 6 women
17% or 1.6 million
1 in 4 women
23% of 2.2 million
have experienced physical or sexual violence by a current or previous partner since the age of 15
have experienced emotional abuse by a current or previous partner since the age of 15
1 in 16 men
6.1% or 548,000
1 in 6 men
16% or 1.4 million
Q
1 in 20 men 1 in 5 women
have experienced sexual violence since the age of 15
18% or 1.7 million 4.7% or 429,000
1 in 9 men
1 in 6 women were physically or sexually abused before the age of 15 16% or 1.5 million
code, and quite honestly with our obligations to one another as human beings. What impact has COVID had on people living in vulnerable circumstances? Firstly, we know that A approximately 41% of people have experienced some kind of
Q
11% or 992,000
negative employment impact through this pandemic. Just as a factor all on its own, that creates vulnerability for certain people who were never before in vulnerable circumstances. And it will exacerbate vulnerability for those who were already in that space. We also know, for instance, that pre COVID-19, every year in Australia about one in five people
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were experiencing mental illness. During this time of COVID-19, it looks as if that could end up being something like one in three. So, quite clearly, there’s been a dramatic increase in the number of people who might not only be diagnosed with mental illness but certainly who might be living with or struggling with mental illness. And of course I have to mention domestic and family violence as well. Pre COVID-19, we already recognised domestic and family violence as being at national emergency levels. Disturbingly, all evidence shows that during times of isolation and lockdowns and the restrictions the pandemic has imposed, the rates of domestic and family violence increase quite dramatically. So, not only for people who were already in vulnerable circumstances but for many others, COVID-19 has resulted, and will continue to result, in really difficult situations. Of course, what we need to remember is that it is not necessarily only our customers who might be experiencing difficulty and vulnerability. Brokers and their colleagues may also be facing their own circumstances of vulnerability, stress and challenge. How common is it for people to find themselves in an abusive relationship or environment, and why is it particularly important for brokers to be aware of the signs? Pre COVID-19, we knew that, A for example, one in four women over the age of 15 had experienced at least one incident of physical violence within a domestic relationship. That’s just one statistic. We do need to be careful, though, to make sure that we don’t make any assumption around who might, and who might not, be living in abusive circumstances within our communities. Yes, it is agonisingly common for women and children to be in that situation, but of course that does not mean that men, or in fact any person no matter how they identify, might not be experiencing domestic and family violence. We need to be very aware as well that these are circumstances that are occurring in all types of domestic or family relationships. It’s quite dangerous to have tunnel vision to think that we’re only looking at a traditional husband and wife. We need to broaden our thinking and understand, for example, that people living with
Q
disability are at a hugely increased risk of abuse as well. So, in terms of how common it is, this is something that each and every one of us really does need to be aware of, particularly brokers who are in a unique position in the type of relationship that they create and build with their clients. Relationships, I understand, are really at the core of a successful broker business, which means that they get a unique insight into people’s lives and experiences. For those people who are at risk, a bad experience or response from a third party such as their broker can really create a huge barrier to them coming forward to get the support that they might need. So it really is important that brokers understand the necessity to be absolutely aware and to understand how to ensure that, every time they are responding, safety is the priority – not to become the therapist or the counsellor or the investigator, but to understand that safety is an absolute priority. What are brokers’ obligations under the Banking Code of Practice when it comes to the mental and physical health and wellbeing of their clients? Generally speaking, what the A Code of Practice asks is that, whenever a customer finds themselves in any type of vulnerable circumstances, we respond with sensitivity, we respond with
Q
Cutty Felton, CEO, Accidental Counsellor
they refer it to the lender in accordance with each lender’s processes. The lenders have specialist teams that are in place to support those circumstances. So, it’s very important that the broker is familiar with each lender’s requirements or process and makes that referral through to the lender.
“Safety and stigma are why people who are in desperate circumstances very often find it almost impossible to disclose it and seek help” Cutty Felton, CEO, Accidental Counsellor compassion – and the words “extra care” are used. And I guess that really is the question: what does “extra care” really mean? Again, making sure everything we do prioritises safety is incredibly important, but my understanding is that, at the end of the day, what extra care probably means for a broker – in addition to being aware, noticing what’s going on – is that every single time it comes to their attention that a client is experiencing any type of vulnerability, it is imperative that
What inspired you to become a counsellor and do this important work? I particularly love this question, A and the reason I love it is because I am not in fact a counsellor, and that’s exactly what inspired me to do this. I have experience through my time with Lifeline’s 13 11 14 crisis support and suicide prevention service of just what an extraordinary impact every single one of us can actually make in those moments when we are
Q
with people who are facing enormous challenges. In what other ways do you hope your upcoming sessions will help brokers? There is so much talk around A the various factors of vulnerability at the moment, but as people, each broker really does approach their client on a very human basis. That’s what makes brokers such a strong force within our communities; that’s why people trust their broker. So, as human beings, I’m hoping that these sessions will raise awareness around these issues of vulnerability. When we raise awareness and have open conversations, we start to reduce stigma. Safety and stigma are the two main reasons why people who are in desperate circumstances very often find it almost impossible to disclose it and seek help. So if we can reduce that stigma, then essentially what happens is that we will start to increase safety for everyone in our community, not just as professionals but as human beings too.
Q
To register for the MFAA Accidental Counsellor sessions from 4 to 13 May, visit mfaa.com.au/ education-events/events. AB www.brokernews.com.au
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FE AT URES
OPINION
COMMERCIAL LENDING COMES OF AGE Commercial broking is becoming more confident and sophisticated, argues Lend’s head of third party, Donelle Brooks. As the alternative finance sector grows, commercial brokers are finding more nuanced solutions to their clients’ needs, such as compounded products supply chain finance, invoice factoring, and so forth. Interestingly, not only have the types of available lenders and product areas changed, but so has the profile and financial maturity of business borrowers. The commercial lending landscape is being affected by two concurrent forces: the rise in customised funding solutions driven by businesses’ current and emerging requirements.
alternative finance sector is evolving at an accelerated rate, perpetuated by the constricting risk profile of traditional lenders and their appetite for applicants other than ‘vanilla’. And understandably so, as there are many borrowers who fit the traditional lenders’ mould and are subsequently benefiting from a time when money is cheap and competition is fierce. Though, conversely, the upswell of ‘anything but vanilla’ clients continues to drive demand for specialist finance, particularly in the world of business borrowing, in which entrepreneurialism and ‘off-piste’ concepts, operations and solutions have become the accepted state of play versus the exception. THE
Alternative lenders scoop up overflow Alternative commercial lenders continue to provide a home to the overflow of clients that don’t meet traditional lenders’ strict credit criteria. Perhaps 20 years ago, this overflow was met with the emergence of non-bank lenders, which primarily provided bad credit clients with the stepping stone to ultimately refinance back to a traditional lender. The non-bank sector therefore started to rival traditional lenders’ incumbent position as the only place then available for business credit and thus established the landscape, and acceptance of, alternative finance. With the gateway now open to specialist funding, the commercial finance sector has evolved at an increasingly rapid rate, mirroring the opportunities and fallouts from the GFC, the mass decentralisation of industry with a perpetual flow of mergers and acquisitions across multiple sectors, and now the COVID-19 pandemic. With each phase of economic turbulence, alternative commercial finance lenders have responded with more and more niche offerings that provide highly customised solutions to specific business challenges. Consequently, business borrowers are now in the enviable position of being able to access all sorts of commercial finance, from secured to unsecured short-term and term loans, to asset finance, lines of credit, 24
Businesses embracing opportunity It appears that the more extreme the disruption, the more opportunistic people become. Why? Because disruption of any description forces people to take stock,
open to alternative commercial finance to support new ventures and/or operational structures. And they are turning to brokers for the solution. This dramatic shift towards starting new businesses has been substantiated by a staggering 250% year-on-year increase in Lend’s platform as borrowers use funds to start or acquire new businesses. Compounded products the new flavour Commercial broking is reaching a new level of sophistication and confidence that correlates with the sector’s growth and maturity. There’s a significant attitudinal shift towards commercial finance and
Commercial lending is being affected by two concurrent forces: the rise in customised funding driven by businesses’ current and emerging requirements
Donelle Brooks Head of third party, Lend
personally and professionally. And the bigger the disruption, the more pressing the re-evaluation tends to become. The most recent disruption, COVID-19, has universally prompted people to reassess their lifestyle, review finances and reconsider priorities. For some, this process is self-motivated. For others, it is necessitated by pandemic-related redundancies, wage cuts and restructures. In the wake of this, people are demonstrating fundamental psychological shifts. There is a far greater openness to thinking, acting, and considering life differently. And this has a material effect on business and, in particular, business practices. In traditional operations, attitudes towards overheads (such as office space), remote or hybrid environments and the role of IT have been revolutionary. Similarly, there’s a substantially more progressive approach to different business ventures and structures. The net effect is the movement towards a more astute business borrower who is
its benefits in the context of a business’s overall operations. In particular, the cost of the opportunity versus rate alone is being more carefully considered. Similarly, brokers are more proactively educating their clients about the products available and their respective uses. In stark contrast to the traditional one-size-fits-all approach, this change is materialising in the rise in brokers providing ‘compounded product’ solutions – meaning multiple products and/or multiple lenders are being considered to meet a business’s holistic requirements. For instance, a company may require asset finance, but because it has a low monthly turnover, with income held in debtor ledgers with invoice lags, they may benefit from debtor finance that’s backed by a line of credit facility. Lend.com.au is well aligned to support brokers at all levels of commercial maturity with its sophisticated AI product/lendermatching technology that does the heavy lifting, which fast-tracks the aligned solution. AB
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PEOPLE
CAUGHT ON CAMERA On 23 March, Semper Capital hosted ‘The secrets to being a successful commercial broker’, a hybrid in-person and virtual event featuring a panel of specialist commercial brokers who provided insights into how to get ahead in the space. Held at the Four Seasons Hotel in Sydney, the event was attended by more than 90 finance industry professionals, including brokers, accountants, valuers, and media and industry associations. The panel comprised of Andrew Way, director and founder of Semper, Nick Harper (Fuzion Capital), Robert Grul (G&H Financial), Judy Corak (efunder) and Anthony Landahl (Equilibria Finance). It was moderated by Sascha Moore. Among the topics discussed were the importance of mentors, and how commercial brokers should set their fees.
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DATA
i
VICTORIA
ACT SPOTLIGHT
Melbourne is playing catch-up in terms of annual property price growth Metropole Property Strategists director Michael Yardney expects Melbourne to realise a 16% gain in property prices this year and further growth of 6% by 2022. “While Melbourne housing values suffered because of its extended lockdown, which severely impacted market activity in 2020, since late October the Melbourne property market has rebounded strongly,” he said. CoreLogic figures show that the annual median dwelling price in Melbourne grew by 0.7% to $736,620. This gain is substantially lower than Sydney’s 5.4%. “There is still plenty of growth left, as Melbourne property values have only just reached their pre-pandemic levels and are about to create new peaks, meaning they will only now reach the previous 2017 peak levels,” Yardney said. However, he believes some segments in the city might not perform as well as others, with the inner-city and high-rise apartment markets likely to underperform. “I’m worried by a large number of poorly built inner-city apartments on the market or planned for completion,” he said. Area
Metro (H)
Median
Quarterly
12-month
Weekly
Gross
price
growth
growth
median
rental
$800,000
2.0%
rent
yield
6.3%
$430
2.9%
Metro (U)
$607,000
1.3%
5.3%
$400
3.5%
Country (H)
$460,000
5.0%
11.5%
$360
4.5%
Country (U)
$350,000
4.2%
9.5%
$300
4.8%
TASMANIA
State boosts its efforts to increase the supply of social dwellings Roger Jaensch, Tasmania’s minister for housing, has said the recently built homes in Glenorchy are part of the state’s investment in social housing that will see 1,500 additional homes built by the end of June 2023. “The homes are a mix of one- and two-bedroom dwellings which have supported apprenticeships and jobs during construction and will now go on to assist those experiencing homelessness and housing stress in the state’s south,” he said. Jaensch said that while the demand for social housing had continued to intensify, the average approval time for social housing applicants fell by 10 weeks over the last quarter of 2020. This has made it necessary to kick-start more social housing projects. He said Tasmania planned to fund another 50 rapid rehousing properties in areas of high demand, including regional areas. “The rapid rehousing properties will provide a boost to transitional housing for those exiting crisis accommodations such as shelters.” Area
Median
Quarterly
12-month
Weekly
Gross
price
growth
growth
median
rental
rent
yield
Metro (H)
$595,000
2.9%
9.7%
$460
4.4%
Metro (U)
$430,000
3.7%
7.7%
$400
5.0%
Country (H)
$390,000
3.4%
10.8%
$340
4.9%
Country (U)
$308,500
0.9%
5.6%
$280
5.1%
26
CANBERRA RENTS STILL SKY-HIGH Tight conditions in Canberra’s rental market continue to push rents up in the most expensive capital city for tenants remains the most expensive rental market in Australia, according to the latest report from Domain. Rents over the first quarter of the year increased by 3.4% to $600 for houses and 4.2% to $500 for units. These increases have widened the price gap between Canberra and Sydney, where average unit rents are now $30 lower than in the ACT capital. Furthermore, house rents are an average of $50 more expensive in Canberra than in the next most expensive cities, Sydney and Darwin. “Tenants have been operating in a landlords’ market for some time, and landlords are likely to have become accustomed to the fierce competition to secure a lease,” said Domain senior research analyst Nicola Powell. The rent increases could be due to the tight conditions in Canberra’s rental market. In fact, its vacancy rates have fallen further in March to 0.7%, hitting levels similar to those in 2018. “Tenants will find the task of securing a lease CANBERRA
harder, as the estimated number of vacant rentals continues to decline, 14% lower than last year,” Powell said. “This is during a time when Australian expats return, temporary overseas employees extend stays, and the city is better placed economically, buoyed by the public sector and industries reliant on government spending.” Dwelling prices in the ACT have grown by 16.9% from their previous peak in April 2019, according to a separate CoreLogic report. Prices have been hitting new record highs since September 2019. “Part of the strength in ACT dwelling value returns has been due to relatively high incomes across the Territory, along with resilient labour market performance through COVID-19,” CoreLogic said. However, the substantial growth in prices in less than two years poses a threat to affordability, particularly for first home buyers.
CANBERRA HOUSING MARKET INDICATORS Source: CoreLogic, April 2021
Property stats for the week ending 11 April 2021
New listings:
574
Total listings:
1,651
Days on market: 36
Houses
$770,000
64
Median price
Monthly sales
Units
$495,000
141
Median price
Monthly sales
SUBURB TO WATCH: GARRAN Median price (houses) $1,178,000
Median price (units) $625,000
12-month growth
3-year growth
Average annual growth
Gross rental yield
17%
27%
3.7%
3%
12-month growth
Average annual growth
Weekly advertised rent
Gross rental yield
5%
1.8%
$550
5%
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QUEENSLAND
Brisbane is poised to register double-digit price gains this year Michael Yardney, director of Metropole Property Strategists, believes one indicator pointing to a bright outlook for Brisbane is the resurgence of buyer interest. The city’s recent auction results reflect the robust demand, with clearance rates consistently in the 70% range. “This is unusual for Brisbane, considering this city is not known for its auction culture like its southern cousins, but this is just another suggestion that there are more buyers than there are sellers, and this always leads to higher property prices,” he said. Citing a report from ANZ, Yardney said prices in Brisbane could grow by 16% this year and 8% the following year. However, he said the markets in Brisbane are very fragmented, with some segments likely to stay muted over the next months. “Apartment demand has been sliding, and, in general, apartments in Queensland are a higher-risk investment than houses, particularly due to a high supply of apartments that are unsuitable for families or owner-occupiers,” he said. Area
Median
Quarterly
12-month
Weekly
Gross
price
growth
growth
median
rental
rent
yield
Metro (H)
$575,000
1.6%
3.7%
$420
3.9%
Metro (U)
$410,000
2.0%
2.0%
$380
5.0%
Country (H)
$470,000
1.1%
1.1%
$410
4.7%
Country (U)
$405,000
1.3%
4.0%
$350
4.7%
SOUTH AUSTRALIA
Dwelling rents in Adelaide continue to reach new highs
HIGHEST-YIELD SUBURBS IN AUSTRALIAN CAPITAL TERRITORY Suburb
House
Gross rental yield
Median price
Quarterly growth
12-month growth
Average annual growth
DENMAN PROSPECT
H
8%
$540,000
0%
-35%
6.6%
CHIFLEY
U
8%
$310,000
0%
-4%
2.2%
HUGHES
U
8%
$260,000
N.A.
N.A.
-8.7%
DICKSON
U
7%
$412,500
1%
-12%
-1.2%
CURTIN
U
7%
$260,000
-8%
-2%
-7.5%
LYONS
U
7%
$285,000
3%
2%
0.9%
O’MALLEY
H
7%
$1,815,500
13%
-4%
20.7%
CRACE
U
7%
$365,000
-1%
9%
-4.5%
HAWKER
U
7%
$319,500
-20%
-26%
2.1%
BELCONNEN
U
6%
$415,000
2%
9%
0.6%
Weekly house rents in Adelaide increased by $15 to $425 over the first quarter of the year, while unit rents went up by $10 to $350, according to the latest report from Domain. House rents increased by 3.7% quarterly and 7.6% annually, marking the steepest gains on record in the housing segment. “Despite rising rents, Adelaide remains the most affordable capital city for tenants,” said Domain senior research analyst Nicola Powell. However, it is worth noting that the gap between house rents in Adelaide and Melbourne continues to narrow. Rising rents in the SA capital could be due to its falling vacancy rates, which have hit a multiyear low of 0.6%. Several factors could explain this drop in vacancies. Powell said more people are now relocating to SA. This is reflected in interstate migration numbers, which have been growing for two consecutive quarters. Subdued investment activity and apartment construction in the city in recent years have also limited the supply of properties for rent. Area
Median
Quarterly
12-month
Weekly
Gross
price
growth
growth
median
rental
Metro (H)
$520,000
2.2%
rent
yield
3.9%
$395
4.1%
Metro (U)
$380,000
2.0%
7.2%
$340
4.6%
Country (H)
$297,000
0.4%
2.1%
$280
5.1%
Country (U)
$230,000
2.4%
0.0%
$220
5.4%
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DATA
WESTERN AUSTRALIA
Perth has reported its shortest selling times since 2006 Perth properties are currently staying on the market for just 17 days before being sold, according to the Real Estate Institute of WA (REIWA). “Perth is a sellers’ market at the moment, and buyers are facing a lot of competition to secure a property,” said REIWA president Damian Collins. He said this strong demand was already reflected in the growth in home values. Median prices in Perth have increased by 1.8% in March to $495,000. “This is the seventh month in a row the Perth home value index has increased, and it shows no signs of slowing down. On a quarterly basis, the home value index is up 5% since the start of the year,” Collins said. There were 67 suburbs across Perth that recorded an increase in the median house price over the month. Cottesloe was the strongest performer, posting a 5.4% price gain to $1.95m. Como came in second, with home prices increasing by 4.1% to $895,000. Yangebup, Duncraig, Claremont, Ballajura and Dudley Park also posted stable gains in prices over the period. Median
Quarterly
12-month
Weekly
Gross
price
growth
growth
median
rental
rent
yield
Metro (H)
$518,000
2.0%
2.5%
$390
4.1%
Metro (U)
$395,000
1.4%
-0.8%
$350
4.9%
Country (H)
$385,000
2.8%
10.6%
$365
5.2%
Country (U)
$255,000
5.0%
6.5%
$320
7.4%
NEW SOUTH WALES
ADELAIDE Total auctions
1
Cleared
48
Uncleared
180
Clearance rate
82.8%
PERTH Total auctions
30
Cleared
13
Uncleared
13
Clearance rate
50%
Houses
Units
Quarterly
12-month
Weekly
Gross
growth
growth
median
rental
rent
yield
$499,000
$816,000 $354,500
$532,000
$460,000
$598,500
$395,000
$515,000
$361,500
$100,000
$523,500
$200,000
$410,000
$300,000
$550,000
$500,000 $400,000
$570,000
$700,000 $600,000
$730,000
$800,000
$665,000
$900,000
The state’s South Coast housing market is booming, with properties selling faster and at 20% higher prices, according to Raine & Horne. Days on market for properties listed in the Shoalhaven area have dropped from the long-term average of 45 to just five. Tony Hopper, director of Raine & Horne Mollymook and Milton, said open-home numbers had increased significantly to up to 20 people. “We’ve enjoyed our single-best start to the year in the 40 years I have been working in this market. Central to this activity are Sydney buyers who have realised they don’t need to live in the city to earn a decent living,” he said. Over the first quarter of 2021, property sales were 50% higher than last year. Hopper said these were amazing results given the pandemic and the recent bush fires. “People just wanted to get out of Sydney, move down here and start working from home.” Combined with shrinking listings, the strong demand for homes could put the region in a sellers’ market, Hopper said. Median price
The preliminary clearance rate improved slightly this week compared to the previous week, with the number of auctions bouncing back after the Easter slowdown. There were 2,448 homes taken to auction, with a preliminary clearance rate of 80.5%, compared to 2,199 homes and 79.4% in the week prior, revising down to a final figure of 76.8%. At the same time last year, only 30% of homes sold across 1,922 auctions. In Melbourne, 1,204 homes went to auction, returning a preliminary clearance of 78.1% (revised down to 72.5%), compared to a preliminary figure of 77.2% the week before, when 1,059 auctions were held. Sydney’s results were better, with volumes increasing and a preliminary clearance of 84.8% across 913 auctions, up on the previous week’s 821 auctions with a preliminary figure of 82.8%, which revised down to 81.4% at final figures. Canberra recorded a solid 87.4% auction clearance rate, followed by 82.8% in Adelaide, 72.7% in Brisbane and 50% in Perth.
MEDIAN HOUSE AND UNIT PRICES
NSW’s South Coast is experiencing its best housing conditions since 1981
Area
WEEK ENDING 18 APRIL 2021
$875,000
Area
CAPITAL CITY AUCTION CLEARANCE RATES
$0 Sydney Melbourne Brisbane
Adelaide
Perth
Hobart
Darwin
Canberra
CAPITAL CITY HOME VALUE CHANGES Capital city
Weekly change
Monthly change
Year-to-date change
12-month change
Sydney
0.6%
2.4%
8.1%
6.3%
Melbourne
0.4%
1.5%
5.7%
1.3%
Brisbane
0.4%
1.9%
5.8%
7.6%
Adelaide
0.6%
1.8%
4.3%
9.6%
Metro (H)
$1,000,000
1.6%
7.8%
$550
2.9%
Metro (U)
$722,000
0.0%
3.6%
$499
3.6%
Perth
0.1%
1.1%
5.4%
6.4%
Combined 5 capitals
0.5%
1.9%
6.7%
5.2%
Country (H)
$540,000
3.0%
7.3%
$420
4.2%
Country (U)
$460,000
2.3%
7.1%
$360
4.2%
28
*The monthly change is the change over the past 28 days
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BRISBANE CANBERRA Total auctions
112
Cleared
90
Uncleared
13
Clearance rate
Total auctions
104
Cleared
64
Uncleared
24
Clearance rate
72.7%
87.4%
SYDNEY Total auctions
913
Cleared
655
Uncleared
117
Clearance rate
TASMANIA
MELBOURNE Total auctions
84.8%
1,204
Total auctions
4
Cleared
844
Cleared
0
Uncleared
236
Uncleared
2
Clearance rate
Clearance rate
78.1%
n.a.
Note: A minimum sample size of 10 results is required to report a clearance rate.
NORTHERN TERRITORY
Area
Median
Quarterly
12-month
Weekly
Gross
price
growth
growth
median
rental
rent
yield
Darwin’s property market heats up as values exceed expectations Raine & Horne Darwin general manager Glenn Grantham has said vendors in Darwin are making more than 10% above their price expectations due to strong housing demand. For instance, dwellings in areas such as Wagaman, Nakara, Moil and Casuarina are selling for $50,000 to $60,000 above their original prices. “We recently launched a property [in] Wagaman that came with a price of $600,000. By using the traditional sales method, we handed out four contracts at first open, and we fielded 50 inquiries by the time the property went under contract,” Grantham told NT News. He said the sales approach pushed the final value above the asking price. Some agents are also testing other techniques, such as open negotiation. “This is almost like a live tendering process where buyers’ bids are published live. In some instances, these new trendy techniques are working for owners, and they’re achieving competitive market prices.”
Metro (H)
$522,500
4.2%
6.4%
$470
4.9%
Metro (U)
$322,000
3.6%
0.0%
$370
6.4%
Country (H)
$415,500
0.8%
2.9%
$500
6.2%
Country (U)
$354,000
6.7%
6.7%
$380
6.2%
Source: Except where otherwise stated, all data sourced from CoreLogic, April 2021
NICK YOUNG: TRAIL BOOK SALE EXPERT Sell your trail book in part, or in full. Release working capital. Keep your clients. 03 8508 6666 | 0417 392 132 | nyoung@trailhomes.com.au | trailhomes.com.au www.brokernews.com.au
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PEOPLE
Aggregator Finsure
IN THE HOT SEAT
Sam Farha is a mortgage broker with more than 10 years’ experience in banking and finance in roles at Bendigo Bank, CBA, Westpac and Macquarie. In February he joined the brokerage team at LendWealth in Sydney
You have a background in banking. Tell us how you became a broker and how your previous roles helped your transition? Having been in banking since 2009 has provided me with a A wide variety of experience and depth of understanding of banking, in business and residential home lending. This has given me the opportunity to work with clients from all walks of life, with various scenarios across multiple reputable lenders. This experience has been crucial for me as a broker, giving me confidence and an understanding of what is important to banks when assessing a client’s risk factor and customer priorities, whilst helping clients with all their finance needs both on a business and personal basis. I decided to join LendWealth to help customers unbiasedly and provide multiple solutions across all lenders.
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As a new broker at LendWealth, what are your career goals? A The opportunity to work at LendWealth with a group of similar like-minded people, where we have built an organisation that nurtures personal growth and amazing friendships. Not only has this been a professional experience and taught me different approaches to lending, but it has also created some great friendships along the way. LendWealth’s company goals are to disturb the broker industry through its service offerings to clients. We, the foundation members, will be branching out to seven new locations in five years. With access to an endless supply of qualified leads, the sky is the limit.
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What do you love most about your role as a broker? As a broker there are instances when you can help good A people out of bad situations due to the uncontrollable circumstances that life throws at us. Helping people provides me with a sense of satisfaction that my career and studies are being used to better people’s lives. I love being a part of large milestones for people, such as helping them buy their first home, or helping them overcome the stress of upgrading to the home of their dreams and seeing the result of how happy and grateful they are. The benefits of being able to build lifelong relationships and being invited over for a Saturday barbecue are priceless.
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Sam Farha, mortgage broker, LendWealth
What is the most challenging part of the job? Some of the most challenging parts of the role are the same faced by A many brokers – the ever-changing environment and the requirements the entire industry faces, such as increasing turnaround times. The constantly changing policies and staying up to date with the requirements to stay compliant with good record-keeping can be challenging, and understandably so as this is a high-pressure and stressful environment for brokers and bankers due to the amount of risk involved from the banks’ perspective. One of the most challenging parts of the job is providing prompt and accurate responses to clients whilst maintaining settlement deadlines. AB
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Better together. Continually improving the experience to make our partnership stronger.
Our simpler Home Loan Pricing Tool An improved pricing tool, with more functionality - so you can get the best outcome for your customer, faster.
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