Australian Broker 14.08

MAY 2017 ISSUE 14.08

Broker remuneration in the firing line Sedgwick review calls for major changes to broker compensation /18

Brokers at the front of the class Financial literacy skills help students excel in daily life /16

BRETT HALLIWELL Advantedge’s general manager explains how the wholesale lender’s white label products have surpassed expectations /14

Changes at the top Pepper Group gets rid of joint-CEO structure /20

ALSO IN THIS ISSUE …

Tough deal, positive outcome Settling for a client with a mental disability /23 Housing market data A state-by-state analysis provides insight on where mortgage demand will be strongest /26 In the hot seat An ambitious young broker forges her own path /30

NEWS

IN THIS SECTION

Lenders Major banks share their views on responsible lending /04

Aggregators First home buyers on the rise again, AFG reports /06

Technology Innovation drives change in the market /10

Regulators Sedgwick review proposes changes affecting brokers /12

Consumers Consumers are more pessimistic about the housing market /08

www.brokernews.com.au APRIL 2O17 EDITORIAL Editor Otiena Ellwand News Editor Miklos Bolza Journalist Maya Breen

DATES TO WATCH

Upcoming industry events and key dates

Production Editor Roslyn Meredith

ART & PRODUCTION Design Manager Daniel Williams

9 M AY

1 0 M AY

1 1 M AY– 1 5 J U N E

Budget Day

Explaining the budget

MFAA National Roadshow

The federal government releases its latest budget, and affordable housing is expected to be at the top of the to-do list, along with the cash economy, immigration and employment

David Watkins and Doug Ross from Deloitte host a post-budget webinar at 9am, providing insight into key issues and explaining the budget’s tax and economic implications

The theme this year is ‘Business Builders’, providing brokers with strategies to improve management, drive new business, and build value and profit. Event held on various dates in Perth, Adelaide, Sydney, Melbourne and Brisbane

Designer Martin Cosme Production Manager Alicia Chin Traffic Coordinator Freya Demegilio

SALES & MARKETING Sales Manager Simon Kerslake Account Manager Rajan Khatak Marketing and Communications Manager Lisa Narroway

CORPORATE Chief Executive Officer Mike Shipley Chief Operating Officer George Walmsley Managing Director Justin Kennedy Publisher Simon Kerslake Chief Information Officer Colin Chan Human Resources Manager Julia Bookallil

EDITORIAL ENQUIRIES

Otiena Ellwand +61 2 8437 4792 Otiena.Ellwand@keymedia.com.au

SUBSCRIPTION ENQUIRIES

tel: +61 2 8O11 4992 fax: +61 2 9439 4599 subscriptions@keymedia.com.au

2 4 M AY

3 1 M AY– 2 0 J U N E

8 JUNE

MPA Business Summit, Melbourne

Pepper Money’s Insights Roadshow

Banking and Finance Ethics conference

MPA magazine’s High-Performance Business Summit features a line-up of award-winning brokers and brokerages that will provide insight and information regarding the skills and strategies businesses need to drive growth and generate revenue in the industry

Following the success of the 2016 event, Pepper Money’s Insights Roadshow is back, with masterclasses in specialist lending on various dates in Melbourne, Brisbane, Perth, Adelaide and Sydney

This Sydney conference provides an opportunity for those in banking and finance to openly discuss and explore ethical issues that are contributing to the erosion of public trust in the industry

ADVERTISING ENQUIRIES

Simon Kerslake +61 2 8437 4786 simon.kerslake@keymedia.com.au Rajan Khatak +61 2 8437 4772 rajan.khatak@keymedia.com.au Key Media Pty Ltd Regional head office, Level 1O, 1–9 Chandos St, St Leonards, NSW 2065, Australia tel: +61 2 8437 4700 fax: +61 2 9439 4599 www.keymedia.com Offices in Sydney, Auckland, Denver, London, Toronto, Manila, Singapore, Bengaluru

30 JUNE

2 7 J U LY

End of ASIC public consultation

MFAA National Excellence Awards

Don’t miss the chance to have your say on ASIC’s review of mortgage broker remuneration. Interested parties are encouraged to submit feedback via the government’s Treasury website until 30 June

The MFAA has announced 315 finalists for its upcoming awards program, selected from more than 450 submissions.

The awards recognise the association’s core values, including professionalism and integrity. The national event will be held in Melbourne

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11-13 OCTOBER Credit Law Conference The 27th annual event in Surfers Paradise brings together banks, credit unions, regulators, associations and market disruptors to discuss the future of credit and lending

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.

NEWS

LENDERS SPECIALIST LENDER SEES STRONG BROKER DEMAND lender NWC Finance is seeing record demand from brokers whose clients are suffering from cash flow issues or struggling to refinance.

The firm has seen a 30% rise in revenue over the past year, with demand increasing off the back of tighter lending restrictions by the banks.

“There has been a surge in calls this year from brokers and accountants whose clients’ finance has fallen over literally hours before settlement of purchases or expiration of finance facilities.”

MAJOR VS NON-MAJOR LENDER MARKET SHARE BY STATE Source: Australian Finance Group 2017 Mortgage Index

2016/17 Financial Year, Quarter 3 Northern Territory

SPECIALIST

Queensland

24.10%

36.34% 63.66%

75.90%

Western Australia

New South Wales 34.05%

34.24%

65.95%

65.76%

South Australia

MAJOR APPOINTS NEW STATE GM FOR THIRD PARTY LENDING has appointed Sarah Willsallen as the new state general manager NSW/ACT, consumer third party distribution.

Willsallen will lead a team of business development managers who provide expert mortgage advice to brokers. The bank said her extensive experience in commercial businesses across product sales, technology and B2B services in Australia and abroad had set her up for success in the role. And she has a natural ability as a leader.

Victoria

37.11%

33.59%

62.89%

66.41%

Major

Non-major

WESTPAC

“I’ve spent some time with the team and look forward to tackling some of the challenges the sector is facing now and will confront in years to come” Sarah Willsallen Westpac state general manager NSW/ACT, consumer third party distribution

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BROKERS AND BANKS ‘ABSOLUTELY ALIGNED’, SAY MAJOR BANKS Two of the big four banks have shared their views on third party responsible lending and APRA’s 30% interest-only cap from two major banks have called for an industry-wide focus on responsible lending to ensure consistency across the first and third party channels.

In an on-stage interview at the Australian Financial Review’s Banking & Wealth Summit in Sydney on 5 April, George Frazis, chief executive of the consumer bank at Westpac, and Catriona Noble, managing director of retail distribution at ANZ, spoke on remuneration within the bank and through the broker channel.

Implementing responsible remuneration strategies across the third party is more complicated than creating a structure for internal banking staff, Noble said.

HEADS

“With our employees, each bank can work on the principals but work quite independently to what’s appropriate for their business. But I think on third parties, we do really need to approach it as an industry, because we don’t want responsible lending to be a point of competitive advantage. We want that to be an industry standard,” she said.

Instead, competitive advantage should remain around the service proposition offered rather than compliance, Noble added.

The industry cannot have distortions between what the banks and brokers are doing, Frazis said, as this would simply move people from one channel to another.

“It does have to be consistent across the whole industry,” he said.

“That may require legislation – I’m not sure about that – otherwise it’s going to be a system with a whole market of risk that goes onto it.”

However, he stressed that third party lending plays a vital role in the industry, and brokers are an important mechanism for helping people to own their own homes.

After speaking to aggregators and brokers, Frazis said both were “absolutely aligned” about doing the right thing for consumers.

“This is not something where we’re coming at it from different directions,” he said. “The industry as a whole has gone a long way towards this.”

When asked about APRA’s recent announcement to put a 30% cap on interest-only lending, Noble said this was a good move by the regulator.

“You don’t want to apply a blunt tool to everybody. You have this dilemma going on where you’re trying to get families into housing, but you’re also trying to cool off the rate of growth.”

NEWS

A G G R E G AT O R S FIRST HOME BUYERS BACK IN DOUBLE DIGITS data from aggregator Australian Finance Group (AFG) shows the number of first home buyers is on the rise nationally.

In the AFG Mortgage Index for the third quarter of the 2016/17 financial year, lodgments by first home buyers increased, for the first time since the first quarter of 2014, to 10% of the total number of loans written.

This was due to FHB schemes such as the one recently implemented in Victoria, said AFG interim CEO David Bailey.

NEW

AGGREGATORS FORM STRATEGIC ALLIANCE aggregator Specialist Finance Group has announced a partnership with My Local Group to provide additional aggregation services and value-add offerings to all My Local Broker businesses.

“Both companies share a common commitment in providing excellent service to respective wholesale and retail clients. Both companies have outstanding business reputations for their respective brokerages, and the opportunity to support My Local Group as a business partner simply made good strategic sense,” said William Lockett, managing director of Specialist Finance Group.

BOUTIQUE

A SUSTAINABLE FUTURE AWAITS, BUT ONLY FOR ADAPTIVE BROKERS While brokers will remain key to the mortgage industry, they must evolve with market trends and be aware of inherent risks and their influence on the market are here to stay, but there is a need for the industry to adapt in order to have a sustainable future, new research has found.

The Deloitte Australian Mortgage Report, which was released on 30 March, revealed an overwhelmingly positive response to brokers’ place in the market, said James Hickey, financial services partner at Deloitte.

However, he said there needed to be an evolution of the broker model and the way it engaged with the customer.

At the launch of the report, Hickey led a panel consisting of a number of key lending and finance industry professionals, BROKERS

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who gave their views on the future of the broker channel.

“I think you have brokers who are very much into the customer journey,” said Meg Bonighton, general manager of home lending at NAB. “The ones who ask how do I be there in the right place at the right time? Who is the aggregator I work with who can help me do that best?”

There are two types of brokers, she said: those who believe face-to-face is king, and those who consider broking as a financial-concierge concept.

Malcolm Watkins, executive director at AFG, predicts that consumers will be the driving force behind what they want and how they interact.

“At the end of the day, brokers

will need to become more digitally enabled and capable of providing the consumer an experience that fits with the number of steps they want to manage themselves versus being broker assisted.”

Peter Andronicos, CEO at eChoice, warned of the dangers of this evolution, saying the jump to digital and creating a social media presence could become detrimental to some brokers.

“The reality is that all of a sudden you’re public, and previously you haven’t been. And if you aren’t educated as to how social media works or you expect somebody else to manage your page once a month or once every two months, you suddenly have users being able to make public reviews about your service,” Andronicos said.

While this can be either good or bad, education is required so brokers don’t fall on this double-edged sword, he added.

“First home buyer numbers have been in the single digits for some time. It is good to see state governments looking to support those trying to get a foot on the property ladder” David Bailey AFG interim CEO

NEWS

CONSUMERS BUILDING ACTIVITY ON THE UPSWING latest building activity figures from the ABS show that the final quarter of 2016 finished the year off in a reasonably strong fashion.

While new dwelling starts reached a record high in the March quarter of last year, growth eased during the middle parts of 2016, only to rebound slightly in the final quarter, said Geordan Murray, economist at the Housing Industry Association.

“In aggregate, the total number of commencements increased by 0.3% in the quarter, which was 0.8% up on a year earlier,” Murray said.

THE

CHINESE STILL UNDAUNTED

BY AUSTRALIAN PROPERTY MARKET the regulatory restrictions and the banks’ new curbs on lending to foreign property investors, a new survey suggests that Chinese buyers remain undaunted about purchasing property in Australia.

When asked to name the aspect of the buying process they considered to be most difficult, only 25% of respondents to Juwai.com’s March Chinese Consumer Survey cited financing or transferring money to pay for overseas property as being difficult. This was the result despite Beijing making attempts to reduce the amount of money leaving the country for investment.

In contrast, 33% of respondents said navigating the legal system and legal processes was the most difficult aspect of buying property overseas. Another third chose ‘selecting property’ as their biggest challenge.

DESPITE

CONSUMERS MORE PESSIMISTIC ABOUT HOUSING MARKET A shift in buying conditions has meant a drop in public sentiment around whether or not now is the right time to purchase real estate

in the housing market has dropped and Australians are feeling more pessimistic about whether to purchase property, a new survey has found.

The latest Westpac – Melbourne Institute Survey of Consumer Sentiment found that the ‘time to buy a dwelling’ index fell from 99 to 96 between March and April this year, below the average of the last year and 20% below the peak levels of early 2015.

An index of 100 refers to a balance of optimism and pessimism in the market, while anything less refers to unfavourable buying conditions and a higher weight of pessimism.

“The fall in April reflected large falls in the two major markets – Sydney and Melbourne – partially CONFIDENCE

offset by solid gains in Brisbane and Perth. Clearly, affordability factors were behind this divergent response,” said Westpac’s chief economist, Bill Evans.

Comparing yearly trends, consumers are still more optimistic about purchasing a dwelling now than they were in April 2016, when an index of 95 was recorded. But the result is still “hardly encouraging”. the report said. This April marks the fifth consecutive month when the index tumbled below 100.

The Westpac – Melbourne Institute Index of House Price Expectations for April also fell by 1.1%, which may reflect new policies from regulators to slow house price appreciation.

“It is worth noting that in the year to April 2016, in the aftermath of the

previous round of regulatory and interest rate changes, the index fell by 16%. Since the Reserve Bank’s rate cuts in May and August 2016 the index has lifted by 19% to be back near previous highs.”

With the board of the Reserve Bank due to meet next on 2 May, Evans said rates were certain to be kept on hold.

“As discussed previously, the board is concerned about excessive household leverage which has been boosted by rising house prices.

While this concern might be alleviated by a rate hike, the real economy is in no shape to deal with higher rates.”

With a stagnant labour market, below-target inflation levels, and a lack of consumer confidence, the authorities are opting for a policy mix of steady official rates and greater regulatory controls, Evans said.

“As noted with our House Price Expectations Index, these regulatory controls – complemented by increases in banks’ rates – have been successful in easing conditions in the housing market in the past.”

LANDLORD GROWTH STALLED IN 2015 Source: ATO, Taxation Statistics 2014-15, Grattan Institute analysis

Number of landlords

The number of landlords stopped growing in 2015 2,000,000 Negatively geared

1,500,000 1,000,000 500,000 0

Positively geared 1995

2000

2005 Financial year ending

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www.brokernews.com.au

2010

2015

NEWS

TECHNOLOGY

NEW MORTGAGE BENCHMARKING SITE LAUNCHED new mortgage comparison website called Benchmark Compare has been launched to help borrowers see how their rates stack up against others in the same demographic.

The site looks at factors such as age, location, income, existing mortgage rate, property value and type (ie owner-occupier or investment), said Simon Milne, finance director at Benchmark Compare.

“After inputting these details into the tool, Benchmark creates an anonymous digital profile of them as a borrower and draws on its extensive database to compare the borrower against other borrowers who closely match their digital profile.”

A

DIGITAL PLATFORM COMPILES CLIENT DATA Two fintechs have teamed up to create a client-facing interface for lenders that includes powerful data aggregation abilities banking fintech The System Works Group (TSWG) has teamed up with Swiss data aggregation specialist eWise to create a digital platform that integrates a client’s financial accounts into a single dashboard.

The Digital Play Platform (DPP) is the next stage in TSWG’s lengthy history of providing online software solutions to mutual banks, credit unions and building societies.

It can seamlessly integrate with core banking and enterprise systems as well as third party systems, delivering a comprehensive suite of banking functions to users, including mortgage applications.

Since its establishment in 1985, BRISBANE-BASED

TSWG has focused predominantly on software and services to the finance sector in Australia and New Zealand, founder and director Mark Paterson told Australian Broker.

The DPP is a rebrand of the NetTeller Digital Banking Suite, with the firm moving away from pure internet banking to a full suite of products tailored for financial institutions.

“It’s basically customer-facing technology to deliver products and services via a digital channel,” Paterson said.

The platform can be accessed via any device and allows users to apply for loans, fill out forms and more.

“Off the back of that, our product incorporates a variety of new technologies: data

analytics, customer analysis, CRM technologies, origination and onboarding technologies,” he said.

With the addition of eWise’s data aggregation, DPP also offers customers a ‘Whole of Me’ type presentation, Paterson said.

Brokers associated with banks implementing this platform can get a comprehensive overview for their customers.

“It fast-tracks the process of drawing all this data together, which a broker or financial institution uses to make an informed decision as to whether this customer should get a loan or an additional facility.”

RAMS Home Loans is one Australian brokerage currently using TSWG’s technology, Paterson said.

“RAMS already has eWise embedded in their current service, and they’re about to get our new service, the Digital Play Platform, in the next couple of months. eWise will be embedded in that as well.”

Source: Deloitte 2017 Mortgage Report

Where will innovation drive change in the mortgage market in 2017?*

Greater use of client data to personalise offers to customers

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0

New products emerging, eg tracker mortgages

1

Improving the customer experience with a focus on building trust

2

Greater direct-to-consumer distribution rather than traditional branch/broker channels

6

Choice has partnered with finance software firm Moneysoft to create a new financial planning tool that will help advisers/brokers strengthen the money management skills of clients and help them reach their financial goals.

The tool will be offered through Mortgage Choice under the name MoneyTrack as part of the company’s cash flow coaching service.

Tania Milnes, general manager of Mortgage Choice Financial Planning, said the software would help the firm’s network of advisers enhance the advice they provide to clients.

MORTGAGE

VV DELOITTE 2017 MORTGAGE REPORT: EXPERTS WEIGH IN ON INNOVATION

Reduce cost of servicing and delivering mortgages through robotics and ‘reg-tech’ solutions

MORTGAGE FRANCHISE PARTNERS WITH FINANCE TECH FIRM

*Numbers indicate how many experts selected each answer

NEWS

A S S O C I AT I O N S

ASIC INTRODUCES NEW PANEL FOR BANNING BROKERS has proposed a new Financial Services Panel which would play a role in banning participants for misconduct in the financial services and credit industries.

The panel would be initially responsible for determining whether ASIC should make a banning order for misconduct within these industries in cases “where it is appropriate for peer review because of its significance, complexity or novelty”, ASIC said in a consultation paper released on 11 April.

The regulator may also consider expanding the power of this panel to other areas in the future, including issuing infringement notices; refusing an AFS or credit licence application; imposing conditions on an AFS or credit licence; and cancelling or suspending an AFS or credit licence.

ASIC

SEDGWICK REVIEW PROPOSES CHANGES TO THIRD PARTY REMUNERATION The ABA’s final report on retail banking remuneration has been released, with 21 recommendations for change Sedgwick AO published the much-anticipated Retail Banking Remuneration Review on 19 April, revealing potentially grim changes for brokers.

The final report examines product sales commissions and productbased payments in retail banking in Australia. These are payments linked to the number or value of products sold, offered or distributed to retail and small business customers.

The review makes 21 recommendations for change.

Although the extent of the changes required will vary, almost every bank will need to change at least some of its practices to comply with these recommendations.

“The 21 actions I propose, if fully implemented in the spirit in which they are intended, will complement STEPHEN

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TRAIL REMUNERATION Source: MFAA Industry Intelligence Service, 1 April to 30 September 2016

Average gross trail renumeration generated per broker, prior to costs per annum $80,000 $70,000 $60,000

Nationally

Northern Territory

$10,000

Tasmania

$20,000

South Australia

$30,000

Queensland

$40,000

Western Australia

$50,000

Victoria

risks in the Australian housing market are behind the RBA’s decision last month to leave the official cash rate on hold.

In the latest board minutes released on 18 March, the RBA pointed to overall growth in housing credit outpacing growth in household incomes yet again. This suggests “the risks associated with the housing market and household balance sheets [have] been rising”, the board said.

Although recent regulatory supervisory measures and a reduced reliance on interest-only lending were meant to mitigate these risks, the RBA acknowledged it would take time to assess the effects of these changes.

They also noted that calibration of the guidance provided by agencies such as APRA was “not precise or straightforward”.

RISING

NSW and ACT

RBA FLAGS CONTINUING RISKS IN HOUSING MARKET

other initiatives the Australian Bankers’ Association (ABA) has underway in the Banking Reform Program and will assist in addressing a trust deficit that has emerged in the banking industry.

They are deliberately intended to signal a sharp break with the past,” Sedgwick wrote.

He recommended that each bank implement the proposals by no later than 2020. Adoption of these recommendations will affect retail bank staff, mortgage brokers and their managers. He suggested these parties should no longer receive incentives based directly or solely on sales performance. Instead, eligibility to receive any personal incentive payments would be based on an assessment of an individual’s contribution across a range of

measures, of which sales (if included at all) would not be the dominant component; and the maximum available payments would be scaled back significantly for some roles.

Sedgwick said changing remuneration alone was not enough and each bank should address the issues “holistically”. He said this might require banks to revise their target-setting, performance management, leader development and culture.

Moreover, putting greater emphasis on the customer, which lies at the heart of the proposed reforms, will require new approaches to measuring customers’ views about their service experience and the outcomes achieved, he said.

A holistic approach also requires that individual banks adopt broadly equivalent reforms to the governance and remuneration of third party channels, such as mortgage brokers. “In my view, any changes, however, must preserve competition and the viability of that industry,” Sedgwick said.

$0 On average, the sum of brokers’ upfront and trail remuneration generated are calculated to be $142,000 p.a.

TECHNOLOGY UPDATE

BROKER REMUNERATION STRUCTURE PREDICTIONS Source: Deloitte 2017 Mortgage Report

Q

What are the likely consequences of the current ASIC inquiry into broker remuneration structures?

s

APPLYONLINE BROKER-ORDERED VALUATIONS – SIMPLE, SMART AND EFFICIENT

10% 25% 30%

5% 30%

Minimal change – the industry has effectively explained to the regulator why the status quo is fit for purpose Soft-dollar incentives will likely be reined in, but other arrangements will remain unchanged Greater disclosure to customers of how brokers are remunerated Movement to flat-fee structures aligned to services performed Restrictions on override commissions or other special terms for vertically integrated brokers and lenders

ASIC FOUND GIVING BANKS HEADS UP ON PRESS RELEASES obtained in an FOI (freedom of information) request show that ASIC has previously worked with banks in drafting press releases. The Australian received a number of emails sent between Adrian Borchok, senior manager at ASIC, and other staff around an investigation of Macquarie Bank’s wealth arm, Macquarie Equities, in 2013. The emails showed that ASIC permitted the big banks to provide input on press releases related to financial services misconduct. However, there was no sign that Macquarie had any input into the specific press release sent out around Borchok’s investigation, The Australian reported.

DOCUMENTS

Dylan Salotti

Dylan Salotti, Managing Director of Divitis Finance, is teaching his new assistant how to order property valuations, and his praise for ApplyOnline Broker-Ordered Valuations is clear.

“Brokers want uniformity in order to make our lives easier. The current process of acquiring property valuations most often means dealing with 25 different lender portals, each with a different login and password.”

“Doing valuations through ApplyOnline just makes it simpler and easier to work with a lender.”

The ApplyOnline Broker-Ordered Valuations service gives brokers a streamlined, consistent process. It’s a standardised approach to brokerordered valuations that enables brokers to order the valuation as part of the loan application process either up front or at any point in the origination process.

“With all the lender changes and the tightening of credit, everything is getting tougher and more time-consuming, and the bottom line is that brokers want things made easier for us,” says Salotti.

ApplyOnline Broker-Ordered Valuations offers a multitude of efficiency benefits. There is one login, it shortens the application processing time, there is no data rekeying as all information entered for the valuation order filters through to the application within ApplyOnline (which means the elimination of errors), it increases visibility online regarding the status of the valuation, and it provides more efficient and enhanced reporting opportunities.

“The ApplyOnline Broker-Ordered Valuations add value to ‘work in progress’ reporting,” says NextGen.Net Sales Director Tony Carn.

“Notably, it embeds the property valuation data ordering process into the ecosystem of the broker group.

“Currently, a broker’s pipeline of loan

Tony Carn

applications doesn’t show when the valuation has been ordered because the application and valuation ordering processes can be separate.

“ApplyOnline Broker-Ordered Valuations incorporates the two processes. This enables brokers and lenders to more accurately view and measure conversion rates, which in turn allows much more meaningful conversations because they’ve got more data at their fingertips to examine valuation activity and more enhanced reporting.

“It also allows brokers to order a valuation at any time in the application process, which provides huge flexibility when servicing client needs.”

The marrying of the two processes ultimately means faster valuation turnaround times and improved customer service due to the surety of the approval of the loan.

Since this service features an address look-up feature, property details are already more accurate, which reduces the number of revaluations. There are also a reduced number of revaluations due to the linking of duplicate orders by referencing a unique identifier.

Carn says the company has ‘‘a steady flow of lenders wanting to incorporate it into their process”.

And Salotti adds that “it’s great to know that lenders appreciate the third party channel”.

“There are a lot of lenders,” he says. “It’s a very competitive landscape. Anything that makes our lives easier is one more reason why we choose a specific lender.

“Lenders jumping on board with ApplyOnline Broker-Ordered Valuations makes brokers very appreciative.

A built-in standard process all in the one environment serves us both and just removes another barrier between us and them.”

FE AT URES

COVER STORY

ADVANTEDGE’S GROWING MARKET FOOTPRINT General manager Brett Halliwell explains how Advantedge is becoming a major player in white label lending by making sure brokers’ and borrowers’ needs and wants are met

KEY NUMBERS

Advantedge’s white label products are offered through

85%

of Australia’s mortgage brokers, up from 35% in 2014

White label now accounts for

6.6%

of overall home loans in the industry, doubling in the last two years, according to the latest MFAA quarterly comparator data

Advantedge loans frequently rank fourth or fifth on aggregator panels

In a recent broker satisfaction survey (October 2016), Advantedge achieved an average Net Promoter Score of

+48

across six of Advantedge’s private label aggregation partners

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may be the little brother of the National Australia Bank (NAB) Group, but this wholesale funder and distributor of white label home loans has emerged as a force in its own right.

“The Advantedge white label suite is owned by NAB; it’s an NAB subsidiary, so customers really get the best of both worlds being a white label product with the absolute confidence of being backed by a major,” says Advantedge’s general manager, Brett Halliwell.

That’s how broker John Tindall, founder of Choice Home Loans Wattle Grove in southwest Sydney, likes to explain it to nervous new borrowers: it’s just a low-cost option, like Jetstar is to Qantas.

“Once customers hear this association to two well-known, bigname brands, they are immediately comfortable with the concept and keen to hear more,” he says.

Within the third party channel, Advantedge doesn’t need formal introductions any more. Its white label products are now offered through 85% of brokers, having more than doubled since 2014, demonstrating its aggressive growth trajectory, Halliwell says.

In 2015, a “watershed year” for the company, Advantedge launched its partner private label products outside of its main three aggregators, PLAN, Choice and FAST. It was embraced by the likes of the Australian Finance Group, Loan Market, Astute Financial and LJ Hooker.

“We are a major lender in our own right. We are playing very ADVANTEDGE

much in the second tier of the Australian mortgage market,” he says.

Advantedge has established an avid following because its products are convenient and competitive for both customers and brokers. The strategy is simple: “It’s built on really strong service,” he says.

For brokers, that means BDM teams are available on the road and on the fly, and the scenarios team has a say, so if a situation has previously been approved the application will automatically be given the green light when

from the first point of contact through the entire life of the loan, Halliwell says.

Tindall has first-hand experience of Advantedge delivering on those promises. Tindall says he’s been consistently impressed by the wholesale funder’s turnaround times, the availability and accessibility of support staff and its Australian-based customer care team.

And for borrowers, one of the biggest selling points is that white label loans generally have lower interest rates. “[This] reflects in part that white label does not have the expenses associated with bricks and mortar or 50,000 staff,” Tindall says.

Follow the grocery store’s lead What’s happening in supermarket aisles is also happening in the mortgage space. As customers

“We are a major lender in our own right. We are playing very much in the second tier of the Australian mortgage market” it’s submitted. The company’s assessment team is also in direct contact with brokers throughout the course of the deal, so their calls aren’t pooled into an anonymous call centre. Advantedge provides settlement services through Mortgage Settlements Australia and recently began allowing customers to make appointments for valuation services for convenience on their clock.

All these pieces fit together to ensure deals can be lodged easily and without hassle, and products are tailored to suit individual needs. With Advantedge, brokers and borrowers are going to have a positive service experience

become increasingly market and product savvy, their confidence, comfort and understanding of white label products has increased, Halliwell says.

“At the beginning, it was a simple product that met a very simple need and could do so at simpler price points. White label mortgage lending has gone down a similar path. It’s really an increased focus on meeting the right service for brokers and customers,” he says.

IBISWorld market research shows that customers are now seeking out supermarket white label products. They are flying off shelves, with 30% of white

and solutions to borrowers who want a mortgage but who don’t want to totally overhaul their banking arrangement. It’s a low-cost, simple product without all the frills.

“There are customers who don’t necessarily want all the services.

They don’t necessarily want to change their overall banking relationship; all they’re after is the right mortgage at the right price,” he says.

Since Advantedge doesn’t have a retail branch presence, brokers maintain the primary relationship with the customer.

With other lenders, brokers may run the risk of losing a client when they walk into a retail branch or phone the call centre, but with Advantedge the broker provides exclusive access to the loan.

“It’s always a monoline mortgage product. The broker can be absolutely secure that they can be working with a customer for their mortgage needs.”

label food products being scanned through at checkout. That’s the trend the white label mortgage market is aiming to follow, and so far it’s going well. White label lending now accounts for nearly 7% of all mortgage lending, according to the latest MFAA quarterly comparator data.

It doesn’t seem to matter if it’s a home loan or a package of pasta, what speaks and propels customers to act is a competitive price and a product that delivers.

Of course, as consumers’ buying habits change and adapt, other companies are taking notice.

But while there are a number of competitors in the white label

mortgage market, Halliwell isn’t deterred by them. In fact, he says they all play an important part in ensuring the sector thrives.

“Advantedge very much wants the whole sector of white label to grow and prosper; that’s very important to us. But given that we have white label competitors, we need to stand out from the crowd,” he says.

“We believe to be successful within this market it’s about the end-to-end experience, and we pride ourselves on delivering all of those factors.”

Halliwell knows brokers ultimately decide which lender they deal with based on how smooth

and seamless the process is, and that’s why Advantedge is all about maintaining its product price and service elements so that brokers adopt them as readily as consumers have adopted supermarket white label products.

Everyone on board Brokers typically have access to 20 or 30 lenders on their panel, including one or two of the big four, with the goal being to offer diversity to borrowers.

Halliwell believes white label should be part of that mix, and makes a strong case for why it ought to be at the forefront of brokers’ minds: it provides benefits

A two-way street The transition for white label and Advantedge has been significant over the last few years, Halliwell says. In the early days in 2009 it was about educating people about the product and familiarising them with the brand.

“It was primarily about education and creating clarity of what we were delivering to meet their needs,” Halliwell says. Today, most brokers are aware of who and what Advantedge is all about.

“The main challenge for us is demonstrating day in and day out that the benefit we provide to them can be better than those of other lenders,” he says.

Advantedge does that by working with its broker partners so it’s a “two-way street”.

“It is a partnership. If brokers can help us to help them with great quality and great package deals, we can step up to the plate in terms of delivering market-leading service.” AB www.brokernews.com.au

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SPOTLIGHT

BREAKING DOWN MONEY MATTERS

Schools are teaching students how to eat healthily, but what about how to save and spend money responsibly?

Nine hundred brokers have made it their mission to make financial literacy digestible

16

www.brokernews.com.au

schools and community groups, which further improves the reputation of the finance broker profession. It is also a chance for members to do something that

A 2016 study conducted by the Money Advice Service, an independent governmentestablished body in the UK, found that just four in 10 young people

We’re not selling a product, we’re not selling ourselves; we’re giving them solutions to the questions that they have had unanswered as teenagers” Mhairi MacLeod, founder of Astute Ability Finance Group makes them feel good outside of the day-to-day operations of their businesses,” he says.

had received financial education, and only 61% of parents admitted to feeling confident enough to talk

FINANCIAL LITERACY RATES AROUND THE GLOBE Source: S&P Global FinLit Survey 2015

Major advanced economies 80%

68%

67%

66%

40%

United States

Japan

Italy

Germany

France

20%

Australia

43% 37%

0%

64%

57%

52%

United Kingdom

60%

Canada

not every day that a broker has to answer the question, “Does a pole dancer get paid superannuation?” But when you stand before a group of high school students, you never know what is going to happen.

Broker and Astute Ability Finance Group founder Mhairi MacLeod knows this well. After visiting six schools and talking to more than 400 students last year about financial literacy through the MFAA Global Money Week program, the comments of the class clowns don’t shock her any more.

But what has shocked MacLeod, and was the impetus for her becoming an advocate for the program, is teenagers’ lack of basic knowledge of how to manage their personal finances.

“What we’re doing is giving them the gift of financial literacy that will push them through young adulthood,” she says.

MacLeod is one of 900 brokers who registered to take part in this year’s Global Money Week program, which aims to help students become financially aware and economically empowered so they can make informed decisions about their finances.

These broker volunteers have made it their mission to “turn the lights on” and teach young people how to manage and save their money, and how to be mindful of what they spend.

MFAA head of communications Stephen Hale says the program matches brokers’ skills with a need in the community. “[It’s] a chance for our members to deliver meaningful education to IT’S

to their children about money.

Back at home, the statistics are just as dismal. Australia ranks ninth in the world for financial literacy, according to Standard & Poor’s 2015 Global Financial Literacy Survey, which found that only 64% of adults could answer three or more basic questions about finances correctly.

In February, UBank released statistics revealing that 41% of Australians surveyed had no idea what their home loan rate was, and nearly half managed only an approximate guess.

MacLeod has seen how these statistics come to be. She’s met students who don’t know the difference between a debit card and a credit card, and who don’t realise they’re charged a fee every time they withdraw money from a competing bank’s ATM. This year, she’s focusing on delivering the program to disadvantaged and underprivileged youth at schools and juvenile justice centres around Sydney.

“These kids are so used to being let down, and these kids are so used to the fact that people take advantage of them, we are just giving them back that ability to have control, and knowledge is power,” MacLeod says. “It’s about giving to those who have been left on the fringes.”

In late March, MacLeod gave talks to about 45 students at

TLK Alesco School, an alternative school on the Central Coast.

In the classroom, she leaves complicated mortgage and finance jargon at the door – something a lot of adults would probably benefit from as well.

MacLeod interviewed the principal and the chaplain beforehand so she could tailor her presentation to best suit her audience. Then to illustrate her talk on budgeting, banking habits, impulse buys, cybersecurity and credit history, she used examples that students could relate to. She told them how much money they could save if they cut back on the number of cigarettes they smoked, how internet shopping didn’t always net huge savings because of shipping and exchange rate costs, and why paying their mobile phone bill on time could help them eventually buy a car.

“It’s a real-life business person giving them real-life examples and working with their demographic,” MacLeod says.

“We are able to steer them in the right direction. We’re not selling a product, we’re not selling ourselves; we’re giving them solutions to the questions that they have had unanswered as teenagers.”

TLK Alesco School principal Jay Osborn says he was “stoked” when MacLeod approached him about giving the talk, especially considering that there was barely any financial education built into the curriculum.

“I would love to be able to see something like this rolled out across all schools, but I also know how busy a normal teacher’s role is on a day-to-day basis to be able to get through the normal content and normal curriculum with their young people,” Osborn says.

While a high percentage of Osborn’s students have anxiety issues, he says they were surprisingly attentive, curious and engaged during MacLeod’s presentations. He hopes they’re now better equipped and more confident about handling their finances on their own.

ASIC has said that teaching financial literacy skills to students is a strategic priority for the regulator. Research shows that more than 80% of 15-year-old

Broker Mhairi MacLeod, centre, with a group of students and teachers from Forms 8 to 10 at TLK Alesco School on the Central Coast

Broker Mhairi MacLeod, far left, with students from Forms 11 and 12 and their teacher at TLK Alesco School

students have bank accounts, 73% earn money from work, and 90% of teenagers own mobile phones, proving why it’s so important to reach young people early on.

“The dynamic development of mobile banking and online shopping reinforces the importance of teaching children and young people about money matters from an early age to ensure they develop sound financial habits and behaviours to help them navigate the financial decisions and challenges they’ll face throughout life,” ASIC’s deputy chairman, Peter Kell, said to kick off this year’s Global Money Week, which took place from 27 March to 2 April.

While the program is officially only a week long, MacLeod and many other brokers continue their pro bono work throughout the year.

“I walked away feeling like I had given back,” MacLeod says of her TLK Alesco School presentations.

“When you have that sense and you can see a change and you can understand that those kids did appreciate that I was there … that’s where I get this kick out of it.

I think we’ve made a difference.

That’s thrilling enough for me.” AB

DO YOU KNOW YOUR NUMBERS? Source: UBank Know Your Numbers Index 2017

100% 90%

85% 80% 75% 75%

80% 80%

70% 60% 50% 40% 30% 20% 10%

of Australians don’t know their home loan rate of Australians don’t know how much credit card debt they owe

54%

of Australians don’t know exactly how much they are paying each month in credit card interest of Australians admit their financial situation is causing worry and stress

0%

www.brokernews.com.au

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NE WS ANALYSIS

UNDER THE MICROSCOPE The Retail Banking Remuneration Review has proposed major changes to brokers’ compensation structure, prompting a backlash from broker associations and aggregators unhappy with the suggestions brokers’ compensation is in the firing line in the final report from the Retail Banking Remuneration Review, provoking an outcry from the third party channel.

The final report of the review, released on 19 April, was financed by the Australian Bankers’ Association and conducted by retired senior public servant and Order of Australia recipient Stephen Sedgwick.

Of the 21 recommendations made to the banks around remuneration, three directly target brokers.

The recommendations include eliminating payments related to loan size, scrapping volume-based incentives that are additional to upfront and trail commissions, and doing away with non-transparent soft-dollar payments in favour of more transparent methods to support training, among other measures.

While many banks have come out pledging to support and adopt the regulations in full, the country’s two national broker associations have been vocal about their disappointment with this review.

FBAA executive director Peter White claims the Sedgwick review protects banks and creates a distraction in the marketplace.

“This person [Stephen Sedgwick] does not make the laws of this country. Yes, it’s a lobbying group, yes, there is some influence there, but at the end of the day ASIC is our policeman. The minister makes the decisions. There are many people at the table lobbying the minister and ASIC, and we are one of the most vocal,” White said.

While the MFAA was pleased that the Sedgwick review found no MORTGAGE

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evidence of systemic harm, CEO Mike Felton said the observations and recommendations made around the broker channel did not present realistic solutions.

executive Ian Narev said the bank would implement many of the review’s recommendations by 1 July, and put all other changes in place by the next financial year. ANZ said it

“It is not the brokers or the Australian Bankers’ Association’s role to tell regulators what to do, or what changes need to be made” John Flavell, CEO, Mortgage Choice “This is a review commissioned by the banks that aims to deal with the banks’ reputational problems, but as far as the broker channel is concerned, it does not create better consumer outcomes,” Felton said.

Both major and non-major banks came out supporting the recommendations. CBA chief

would work closely with both the broker industry and relevant regulators to implement the recommendations. And NAB announced that it would implement the recommendations prior to the 2020 deadline, promising that any changes to third party remuneration would be viable and competitive.

What’s at stake?

One of the major proposals affecting brokers is Recommendation 18, which says banks should adopt a remuneration structure for aggregators and brokers that does not directly link payments to loan size. Instead, the review proposes a “holistic approach” to performance management.

Some people had tried to justify the current remuneration arrangements to the review by arguing that loan size and loan complexity were correlated, Sedgwick wrote. “More persuasive to me were arguments that loan complexity, and thus the effort required by mortgage brokers to secure a loan on behalf of the consumer, may be more closely correlated with the characteristics of the borrower.”

An alternative to a value-related commission might be flat fees paid

HOW BROKERS STACK UP Source: MFAA Industry Intelligence Service, 1 April to 30 September 2016

Total number of new home loan applications in each state, and number of new applications per broker 100,000 90,000 80,000

24 89,000

82,548

22

25 Number of applications

20

20

Average number of new loan applications lodged per broker

18

70,000

15

60,000

15

52,227

12

50,000 38,366

40,000

20

30,000

10 22,917

20,000

5

10,000

1,680

0 NSW and ACT

Victoria

Queensland

Western Australia

South Australia

Tasmania

998 Northern Territory

0

for service by the bank, or related to characteristics of the borrower, he proposed. A client-funded fee was not recommended.

Sedgwick pointed to the ASIC report into mortgage broker remuneration, which also proposed that lenders improve the standard commission model so “brokers are not incentivised purely on the size of the loan”. That report suggested commissions be structured in ways that did not encourage the creation of larger loans that initially had large offset balances.

“I therefore propose that the banks with a significant recourse to the mortgage broker channel move to investigate and, as soon as possible, adopt an alternative payment system with strong oversight by ASIC,” Sedgwick wrote.

But the MFAA said the recommendations in Sedgwick’s review went beyond those presented

by ASIC. The ASIC report did not recommend removing the link between loan size and commission, or a fee-for-service model, or removal of trail commission, for good reason, Felton said.

“A single, lender-funded fee for service is likely to lead to a degree of standardisation of all fees, which ASIC is not calling for. It may also be considered anti-competitive by the Australian Competition and Consumer Commission, and therefore would not be able to be implemented,” he said.

As for Recommendation 17, which proposes that broker payments align with those of bank staff, White said this was not going to happen unless banks started paying brokers a very strong, competitive salary and removed clawbacks.

Furthermore, claims that link the difficulty in writing a loan to the characteristics of the borrower instead of the loan size were simply incorrect, he said.

“Anyone who’s actually written credit in their lives knows that this is not the case. This shows that this person hasn’t done any lending, or if they have, they really don’t understand what they’ve been doing.”

Other misgivings National aggregators and mortgage franchises also responded to the recommendations with apprehension.

ASIC proposed merely tweaking commissions, not overhauling them, said Connective director Mark Haron.

“A flat fee would have unintended consequences on customers who need

consumers are implemented,” he said.

John Flavell, CEO of Mortgage Choice, told Australian Broker the Sedgwick review was long on anecdote and short on facts.

“It is not the brokers or the Australian Bankers’ Association’s role to tell regulators what to do, or what changes need to be made,” he said.

Lack of consultation Felton expressed frustration that the review claimed to be focused on a customer-centric viewpoint while ignoring that that was a key aspect of how brokers and aggregators functioned.

“The review’s recommendations on the third party channel appear to be based mostly on anecdotal evidence from its members. It is

“The review’s recommendations on the third party channel appear to be based mostly on anecdotal evidence from its members” Mike Felton, CEO, MFAA the support and advice of a broker not necessarily getting it,” he said.

Connective had not yet received any proposals from lenders to move to a flat-fee structure. Sedgwick had yet to approach the aggregators for consultation as well.

Haron echoed the FBAA’s comments that neither Sedgwick nor the banks were the lawmakers.

“They’re part of the broader community and everyone needs to be consulted, specifically in conjunction with the regulators, to ensure that the right model and outcomes for

unfortunate that the review process did not include meaningful consultation with the broader industry,” he said.

White said the FBAA had not been approached by the Sedgwick review either.

“You’ve got to wonder behind the scenes, what are the real drivers?

And I question what those drivers are. Part of our regulatory experience is all about truth through transparency. I think we’ll never see the true transparency that sits behind this report.” AB

KEY RECOMMENDATIONS AFFECTING BROKERS

Recommendation 16 a. Banks cease providing volume based incentives that are additional to upfront and trail commissions b. Banks cease non-transparent soft dollar payments in favour of more transparent methods to support training, etc. c. Banks cease increasing the incentives payable to brokers when engaging in sales campaigns

Recommendation 17 Banks adopt, through negotiation with their commercial partners, an ‘end to end’ approach to the governance of mortgage brokers that … is broadly equivalent to that proposed for the performance management of equivalent retail bank staff

Recommendation 18 Banks adopt approaches to the remuneration of aggregators and brokers that do not directly link payments to loan size and reflects a holistic approach to performance management

www.brokernews.com.au

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IN THE NE WS

CEO SHAKE-UP After four years as joint CEO at Pepper Group, Patrick Tuttle has been made redundant, leaving Michael Culhane the man in charge

was “instrumental” in its success.

In 2016, the company reported a total income of $413.2m, an increase of 36% from the previous year.

Tuttle and Culhane worked together for 16 years, and in 2010 they teamed up to organise the purchase of Pepper

their businesses. In the various countries that Pepper operates in, including South Korea, Spain and Ireland, experienced managers handle their units’ profit and loss responsibilities. The office in Sydney oversees operations, dealing with risk,

“I take enormous satisfaction in knowing that I leave the company in a strong financial position” Patrick Tuttle, former Pepper Group co-CEO

Patrick Tuttle

an unexpected move, Pepper Group announced last month that it had made one of its two CEOs redundant in order to streamline the company and align with global leadership norms.

Patrick Tuttle was let go on 31 March after four years as co-CEO alongside Pepper founder Michael Culhane. The positions were consolidated and Culhane assumed all responsibilities.

“There was an opportunity to streamline the business, and there aren’t many two-CEO companies that exist in the world today … at some point there needed to be one, and that led to a very hard and very difficult decision,” Culhane told Australian Broker.

“There were absolutely no issues between Patrick, the board, and me, or the company, nothing of that nature at all.”

Culhane emphasised how difficult the decision was, particularly because of how close he and Tuttle had IN

20

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Michael Culhane

become as colleagues for nearly two decades. “It’s someone I’ve known for a very long time and have a huge amount of respect for personally and professionally, and so obviously that human element is hard for everybody,” he said.

During Tuttle’s tenure, the non-bank lender experienced “substantial and sustained growth”, and chairman Seumas Dawes said he

back from Merrill Lynch, which by then belonged to Bank of America.

“Whilst I am disappointed with this decision, I take enormous satisfaction in knowing that I leave the company in a strong financial position. … I have had a passion for this company and all its employees since joining in 2001, and will greatly miss their camaraderie and the cut and thrust of what continues to be a dynamic, innovative and groundbreaking Australian business,” Tuttle said in a statement released by Pepper on 3 April.

He has not said what his plans are going forward.

Culhane said the change at the top would not alter the company’s strategy, which is to empower local management teams to run and grow

funding, technology and finance.

“That strategy is what’s been in place since day one, and it will not change; that’s how we’ll continue to run the business,” Culhane said.

While Culhane admitted his work-life balance would be off-kilter for a while as he adjusted to being the sole CEO, he said he was tremendously excited about the many opportunities ahead.

“That continues to be driven by banks around the world having to hunker down and focus on the absolute core activities of their various jurisdictional institutions, and that allows us to find very interesting niches to take advantage of in lots of the countries in which we operate,” he said. AB

PEPPER’S GROWTH HISTORY Source: Pepper Group investor presentation

Total income over time ($m)

450

Advisory

400 350

% R 51 CAG 20.4

300 250 200

22

150 100 50 0

Servicing

7.1

22.9

67.4

CY2012A

CY2013A

16.2

169

167.4 114.3 226.8

70.8

52

17.5

Lending

100.2

120.7

CY2014A

CY2015A

CY2016A

OPINION

MAKE IT MANDATORY

Richard Wellsmore, manager at financial consultancy and brokerage firm Futurity, says financial literacy could be the great equalizer between the haves and the have-nots I endorse the ideals behind the Global Money Week initiative, I feel that for it to really have an optimal outcome it needs to be a permanent fixture in our education syllabus rather than a subject that is provided externally for a mere week within the academic calendar. Only then will it be given the true respect it deserves.

Building financial literacy skills is integral to preparing a young person for the modern world. So much effort is put into educating our children and encouraging them to pursue a particular career path to increase their chances of getting a job they like and that pays well, yet WHILST

Financial literacy skills are put to use from our very first pay cheque, when employees become part of a superannuation scheme. This scheme was developed to deal with the pension issue that is now front and centre of every budget.

Whilst superannuation has proved to be very effective, it is not the be-all and end-all of the matter. It is essential for people to devise additional strategies to accommodate their future retirement needs.

One simply cannot retire comfortably if one does not have an asset base from which to derive an income. People need to learn the difference between personal exertion income

Building financial literacy skills is integral to preparing a young person for the modern world we do not teach them how to maximise and manage the profits or to handle their spending habits once they actually secure that job.

As it stands at the moment, the only ways a person gains financial literacy are either through the ‘school of hard knocks’ – think defaults, credit card debt and bankruptcies – or they are lucky and learn it via osmosis, perhaps because they have grown up in a home of means or they have parents who know how to invest and manage their money.

The stark difference between these two ways of learning these skills is one of the reasons I think there is such a huge social and economic divide between the haves and the have-nots in Australia. If financial literacy was taught as part of the curriculum, the chasm between these groups could be more easily breached. Why not give the have-nots the opportunity to have?

Governments around the world are struggling to support their ageing populations, which means future generations have little hope of receiving a pension upon retirement. In light of this, the more financial literacy a person can gain at a young age, the better equipped they will be to determine their own future rather than relying on government assistance.

and passive income, as once they’ve reached the point of no return in terms of personal exertion income (let’s face it, we all want to be able to pull back on our working hours at some point, whether it be by choice or necessity), passive income has to be there to kick in and provide some level of comfort.

The longer people have to plan for this, the more comfortable and safe they are likely to feel. Ideally, we should start planning this from our very first pay cheque. Without financial literacy people remain largely oblivious to the need to plan for retirement until it’s too late to make up the missed ground.

Better financial literacy from the beginning means a more educated population overall, one that understands how to invest prudently and manage debt responsibly, and can hold politicians to account on the economy so that sound bites don’t pass for facts.

Until the education system catches up and gets on board with a prolonged and robust financial literacy course, the Global Money Week program is one step in the right direction.

But when that week is over, brokers can still play a significant role in improving financial education as a whole, one client at a time. AB www.brokernews.com.au

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PEOPLE

Have an interesting deal?

Had a particularly difficult or interesting deal? Why not share it with us? Email:

Otiena.Ellwand@keymedia.com.au

A BIG DEAL

Go Mortgage Corporation’s Xavier Quenon spent two months and countless hours negotiating a deal that would allow his client to go mortgage-free three years earlier than expected. But the client may never even know it happened

Location: South Brisbane, Queensland

THE FACTS

THE SOLUTION

I looked straight off the bat at a few different

Loan term 19 years

Client Single man in his late 30s with a mental disability

Goal Get the client a better deal

lenders to make sure we could access a large panel and get the best deal possible.

I looked mainly with the big four, but three of them quickly rejected the situation.

I ended up placing the loan with National Australia Bank. NAB was the most cooperative lender in the mix. I not only had to get approval from the bank but also

THE SCENARIO

We bought a loan book a little while ago and I was going through it when I noticed a client who had escaped me the previous year. We usually do reviews for our clients on a regular basis. Since having contracted the loan, the borrower went through a traumatic accident that made him partly mentally disabled. He was now on a disability pension and his affairs were managed by a public trustee. What I noticed was the interest rate the existing lender had put him on just wasn’t competitive. Due to his situation, it was difficult to talk to that lender or any others about trying to give him a better deal. But I thought if anyone needs a hand, someone who is not in control or is not even aware that he can get a better outcome, it’s him. It was a little bit like a dog with a bone. I kept with that deal.

Loan size $280,000

of refinancing; that it wasn’t a money grab and I wasn’t preying on a vulnerable person.

It was a lengthy process that took two and a half months. Once the loan got approved by the bank, the public trustee had to sign off on it. I had to get the bank to agree for them to do that as a third party. It was a case of looking at who would offer the best deal and who would accept the type of income and situation the client was in. Other lenders shied away, mainly because his affairs were managed by the state. That’s what rendered the deal particularly hard. The challenge was getting the lender to accept that while the client was not responsible for his own affairs, his conduct was good and there would be a benefit in moving the loan.

I had to get the lender to understand that, if anything, although on the surface it didn’t look good, he was actually a no-brainer client because a third party was managing his affairs without emotion, and his track record and mode of payment were sound.

The fact it was paid from a disability pension would never go away, so he was perhaps less risky than a regular employee who could lose their job.

THE TAKEAWAY

We saved the client more than half a per cent in interest rate. The repayment plan he was on was acceptable, so we decided to shorten the term of the loan instead. He would be paid off three and a half years earlier than if he’d stayed with the existing lender. For someone in his situation, being mortgage-free sooner was probably the better outcome. Due to his mental disability, he may never be aware that there was an issue and we improved it.

At the end of the day, I know I’ve done the right thing. He’s not one of those customers who will rave, rant and refer; I’m not even sure if he understands what happened. It would have been easy to put the deal in the too-hard basket; it wasn’t a deal that was particularly financially lucrative, but it was rewarding on an emotional level. You need

Due to his mental disability, he may never be aware that there was an issue and we improved it. At the end of the day, I know I’ve done the right thing Xavier Quenon Director of Go Mortgage Corporation in Helensvale, Qld

had to convince the public trustee that I was doing the right thing for the client’s sake; that this would actually improve his situation. The public trustee was dubious about why a broker would approach them – which never happens – and care about this guy. I had to demonstrate the benefit

to persevere as a broker to make sure you get that positive outcome. I know we live in a more and more regulated environment with rules that sometimes don’t make sense, but when there’s a good cause, perseverance is worth it, and if there’s a genuine benefit for the customer, don’t give up. AB www.brokernews.com.au

23

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FROM THE FORUM

Top comments from trending stories on brokernews.com.au

SEDGWICK SHOOTS DOWN COMMISSIONS LINKED TO LOAN SIZE

STAMP DUTY BACK IN FIRING LINE

The final Retail Banking Remuneration Review released on 19 April contains 21 recommendations made to banks – three of which directly relate to brokers. Recommendation 18 suggests that banks adopt a remuneration structure for aggregators and brokers that does not directly link payments to loan size. Rather, the review proposes a “holistic approach” to performance management. Stephen Sedgwick, who headed the review, said a fee-for-service model paid by the bank was a possible alternative to value-related commission. This could be a flat amount or relate to the characteristics of the borrower.

Homebuyers in Australia’s biggest capital are having to spend almost $75,000 on stamp duty and other moving costs, leading to a major hurdle in improving housing affordability, according to one of the country’s largest real estate associations. New research from the Property Council has found that these costs can set Sydneysiders back $74,815, while homebuyers in Melbourne are $10,000 better off. These high costs prevent efficient use of housing stock, leading to another factor in the housing affordability crisis, the report said.

The community trust that the banks are seeking to restore is their own issue, it’s not the brokers who are lacking in community trust – it’s the banks and their staff who need the overhaul.

The tone of this report seems to suggest that the banks have got what they paid for. If the bank “owns” their brokers then endto-end compliance is appropriate, but for those of us who are independent, then they can back off. It seems like the banks have played a long game and have now reined in a good portion of the broker channel to the point they now control the game.

This is a topic that is a constant bugbear of mine. Quite simply, stamp duty is a tax on individual wealth creation.

In my opinion, it should be abolished entirely, replaced by substantially increased land tax or equivalent measure with exemption/reductions for Principal Place of Residence.

Remove the barriers to wealth creation; impose restrictions (additional costs) on wealth retention.

Observer on 20/04/17 at 8:58 AM

Well, well, The Property Council in favour of something that increases ‘property turn over’. Each time you move property a real estate agent gets paid. Twice. Once on the sale, once on the purchase. That’s a big cost of moving. Would they consider banning real estate commissions? At least stamp duty pays for useful stuff, like schools, roads, police, courts, etc.

Most of these recommendations are okay, however moving to a fee per loan rather than the current commission structure is unrealistic. Banks get increased benefit and profit as the loan amounts increase, so a flat fee would play havoc with cost per loan, especially on small loan amounts, and see banks the winners again for large loan amounts. Neither brokers nor consumers will benefit from such a change. This can be seen in the real estate industry in Queensland. Since the deregulation of commissions, the average charged by agents has increased on smaller priced properties and the benefactors are luxury properties, which is the complete reverse to what the government was seeking. The issue with such reviews is that there is usually a big rift between the ideology that spurts from the recommendations and how they end up translating in real life.

Gotta love the Property ‘Council’ on 7/04/17 at 12:41 PM

Why in hell is the ABA making recommendations affecting the mortgage broking industry? This review came about because the banks have a trust issue, not us. I challenge the ABA to ask any of my clients if they trust me. They are simply trying to avoid a Royal Commission. Hopefully the government and ASIC will see through this misguided report and consign it to the rubbish heap where it belongs. I guarantee that if remuneration is decreased as a result, I and many other brokers will either leave the industry or apply for mobile lending jobs with a bank. Great for competition, huh?!

If stamp duty were replaced by a state capital-gains tax (CGT) on property, it would automatically improve the competitive position of first-time buyers, who by definition don’t have any capital gains to cash in. But even established owners would be better off under a CGT, because: (i) a CGT, unlike a stamp duty on the purchase price, will not turn a profitable purchase-resale cycle into a loss-maker or increase a loss; (ii) the fact that stamp duty is nominally payable by the buyer, and CGT by the seller, does not affect the final incidence of either, due to the higgling of the market; (iii) a CGT causes less discouragement to turnover (less “lock-in” effect) because an owner who “trades up” more frequently does not pay proportionally more tax, but pays tax in a larger number of smaller instalments; and, most importantly, (iv) a CGT incentivises the government to invest in infrastructure that raises property values, and is not payable unless the owner actually receives and realises a rise in value. Of course, these advantages are more robust if the CGT is levied on real (inflation-adjusted) gains.

Fed Up Broker on 20/04/17 at 12:04 PM

Gavin R. Putland on 7/04/17 at 3:06 PM

Xavier Quenon on 20/04/17 at 8:59 AM

24

Simon on 7/04/17 at 9:01 AM

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CAUGHT ON CAMERA

From left: Damien Walker, Bernadette Christie-David and Aaron Christie-David, Atelier Wealth

Atelier Wealth – a Sydney-based brokerage founded by Aaron Christie-David in partnership with his wife, Bernadette Christie-David, and her brother, Damien Walker – held a business associates’ market update at 1821 Restaurant in late March. The event was a chance for the firm’s network of financial planners, accountants, property developers, buyers’ agents, property managers and solicitors to meet and hear from CommSec economist Savanth Sebastian. The family team also introduced its latest partnership with Batting for Change, a charity started by Victorian cricketer Ryan Carters, which creates educational opportunities for disadvantaged women in cricket-playing nations. In lieu of traditional settlement gifts, Atelier Wealth is going to “pay it forward” by giving settlement donations instead. Aaron says this is one of the ways they are striving to be a “brokerage with a difference”.

Ryan Carters, Batting for Change

From left: Bernadette Christie-David, Lizzie Garrett, Aaron Christie-David, Ryan Carters

Aaron Christie-David, Atelier Wealth

Savanth Sebastian, CommSec www.brokernews.com.au

25

DATA

NEW SOUTH WALES

VICTORIA SPOTLIGHT

The crackdown on funds for property development is limiting housing Due to considerable population growth in urban areas, high auction clearance rates and an active lending environment, Sydney’s growth trend is expected to continue.

“There is still a shortage of supply, particularly in Sydney, so demand is still outstripping supply,” explains property investor and developer Harry Triguboff.

“Banks have cracked down on property development finance, which makes it more difficult for smaller developers to access funds for a project. This means there will be less development and inevitably less housing coming onto the market over the coming years.”

Stockland and Mirvac developers predict that the rate of price increases will slow down, according to David Naylor, the co-founder and non-executive director of Chan & Naylor Property Tax Specialists Accountants.

Nonetheless, “sentiment in the market is still strong”, he says.

Area

Type Median value

Quarterly

12-month

growth

growth

Sydney

H

$970,000

7.8%

3.4%

NSW Country

H

$435,000

1.9%

6.3%

Sydney

U

$710,000

2.9%

3.8%

NSW Country

U

$363,000

4.5%

3.8%

WESTERN AUSTRALIA

Declines seem to finally be easing following the resources slump Even though prices continue to drop in Western Australia, experts have hopes for Perth’s recovery.

“After 2016, there has been a significant lift in enquiries and offers since Christmas,” says Geoff Baldwin, managing director at RE/MAX WA. “Property prices are steady at the moment after having continually dropped for the previous few years, and, although we don’t expect booming conditions, we do predict that the Western Australia market will continue to strengthen as the year progresses, resulting in an increase in prices.”

Baldwin points out that investors from Sydney and Melbourne have been showing an interest in WA. “It wasn’t that long ago that Perth prices almost caught up to Sydney’s and were on a par with Melbourne’s. We are now a long way behind both of those cities; however, in real estate, history has a habit of repeating,” he says.

GROWTH SOLID FOR MELBOURNE Melbourne reports the second-highest annual growth rate out of all the capital cities, continuing a nearly decade-long trend strength and population growth are significant factors sustaining Melbourne’s property market.

Along with Sydney, Melbourne accounts for the majority of the population increase in Australia. A significant portion of overseas migrants chose to make their way to Melbourne in 2016, increasing property demand, especially in the CBD. As with Sydney, however, growth is expected to slow down over 2017. As values rise, more and more buyers may be priced out of the city, especially if lending policies are tightened in response.

Moreover, many lenders are increasing interest rates independently of the RBA’s decisions, which could affect mortgage refinancing activity.

Nonetheless, Ken Morrison, chief executive of the Property Council of Australia, sees good things happening in Melbourne’s future. “We are seeing consistent and strong growth expectations across Victoria,” he says.

For those buyers on a budget who are seeking homes located within 15km of Melbourne, the options are becoming limited.

Braybrook and Coburg North are good options, since houses can be found for under $800,000. Those with deeper pockets can look into Footscray or Preston, where houses are priced up to $900,000.

Preston, in particular, is a quick seller, along with Reservoir, according to Tony Lombardi, director of Harcourts. Nearby Thomastown, which lies roughly 17km north of Melbourne, offers houses at a median ECONOMIC

Type Median value

Quarterly

12-month

growth

growth

The Melbourne market has been flying along at about 42% growth over the last two and a half to three years We believe there’ll be a further 2% to 6% growth this year and then this will stop due to regulatory changes and the pressure put on by ASIC and APRA to slow investment lending.

We personally believe from the investment and lending area that the market will be pretty flat after around October, and this could last three to four years for certain markets. The expectation is that some lesser asset classes such as serviced, student, high-density living, off-the-plan and low infrastructure assets could potentially decline 10% over that time.

We believe our customers and the general public should be aware that clients will be buying at the top of this market, and they need to get in front of experts who can advise on this. They should also be aware that investment interest rates will be on the rise and will keep rising until ASIC and APRA are comfortable that the Melbourne and Sydney markets have stabilised.

Mark Davis Director, Australian Lending & Investment Centre, Melbourne

HIGHEST-YIELD SUBURBS IN VICTORIA SUBURB

Area

BROKER PERSPECTIVE

TYPE

MEDIAN PRICE

WEEKLY MEDIAN ADVERTISED RENT

GROSS RENTAL YIELD

Silverleaves

H

$440,000

$1,550

18%

Perth

H

$518,000

0.6%

-3.7%

Inverloch

H

$442,250

$1,200

14%

WA Country

H

$355,500

1.6%

-6.5%

Dimboola

H

$106,000

$175

9%

Perth

U

$406,500

-4.1%

-3.0%

Terang

H

$152,500

$250

9%

WA Country

U

$285,000

9.6%

-8.2%

Ouyen

H

$120,000

$180

8%

26

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OPPORTUNITIES AND KEY INFRASTRUCTURE

price of approximately $500,000.

Cate Bakos, a buyer’s advocate, highlights the western suburbs of Sunshine and St Albans. The former is currently undergoing gentrification and prices are increasing accordingly. However, the latter is stocked with houses in the $500,000 price range.

“I think the rate of change that St Albans will enjoy in maybe five years’ time could be similar to that of Sunshine,” Bakos predicts.

Options like this offer opportunities to first home buyers who have been frustrated by the recent surge in prices. In fact, they have inspired an increase in the number of such buyers in Melbourne over 2016, according to the ABS. These buyers are moving quickly to snap up properties in affordable pockets in anticipation of further growth; however, this activity is expected to slow down this year and the next. AB

MORTGAGE MARKET ACTIVITY Region

Month-on-month change

Month-on-month change (trend)

National

122.5

-17.6%

10.8%

New South Wales

167.0

-18.4%

13.87%

Queensland

105.6

-24.1%

9.9%

South Australia

74.5

-21.2%

6.6%

Tasmania

89.7

-15.7%

10.1%

138.8

-13.3%

10.5%

89.5

-15.5%

8.5%

WA

VIC PROPERTY PERFORMANCE Area

Type

Median value

Quarterly growth

12-month growth

Melbourne

H

$676,000

9.0%

5.9%

Vic Country

H

$320,000

1.6%

2.3%

Melbourne

U

$495,000

1.0%

0.0%

Vic Country

U

$260,000

2.6%

3.7%

SUBURB TO WATCH: WALLAN Median price (houses) $390,619

Median price (units) $287,951

Collins Wharf

The $1.4m Greenvale Reservoir Park upgrade will improve liveability in the outer suburbs

Docklands development promises to include five new parks and generate 3,000 jobs

Racecourse reno

Student housing

Government approves plan for two new residential precincts near the Flemington Racecourse

Construction underway on $50m Deakin University student accommodation project

QUEENSLAND Index value

Victoria

Revitalised parkland

Long-term buyers could benefit from buying at the right time, place and price Regarded by Herron Todd White as one of the most forgiving capital city markets, Brisbane is being looked at by buyers as their next key investment.

“There are very few disappointed long-term buyers in our Sunshine State’s big city, provided they stuck with the fundamentals and bought the right property in the right position at the right price,” Herron Todd White states in its February 2017 Month in Review report.

“With this historic performance as a foundation, there are opportunities to get into Brisbane and hold tight that will leave you feeling very satisfied with your decision come a market cycle or two.”

Popular cafe suburbs are commanding high prices, including Paddington, Bulimba and Woolloongabba. Modest detached housing rarely comes with a price tag lower than $700,000.

However, it is important that buyers continue to take quality into account to ensure that their properties will attract tenants.

Area

12-month growth

3-year growth

5-year growth

Indicative gross rental yield

12.2%

26.4%

20.2%

4.8%

12-month growth

3-year growth

5-year growth

Indicative gross rental yield

6.1%

8.8%

8.9%

5.6%

Type Median value

Quarterly

12-month

growth

growth

Brisbane

H

$524,000

2.5%

3.8%

QLD Country

H

$426,000

-0.9%

1.3%

Brisbane

U

$400,000

-3.1%

-1.9%

QLD Country

U

$370,000

0.0%

3.7%

www.brokernews.com.au

27

DATA

NATIONAL PROPERTY WATCH APRIL 2017 HOUSES

Type Median value

Quarterly

12-month

growth

growth

Adelaide

H

$440,000

1.1%

3.3%

SA Country

H

$285,000

2.1%

0.2%

Adelaide

U

$352,500

0.1%

2.9%

SA Country

U

$193,750

-4.1%

0.3%

The Herron Todd White (HTW) residential property clock looks at which markets are performing well, which are on the rise, and which are on a downward spiral.

The coloured entries indicate a positional change from last month.

This issue’s property spotlight is Victoria, which HTW, a property valuation and advisory group, predicts is on an upward trajectory in many locations.

In Melbourne, inner-city neighbourhoods like Middle Park and Albert Park are continuously desirable locations for owneroccupiers. Dwelling prices there have risen by more than 30% over the last three years.

Other parts of Victoria that are doing well include Ballarat and Bendigo, while Horsham remains relatively balanced on the supply and demand fronts.

Sydney

NSW North Coast

Gold Coast

South East NSW

Ipswich

Sunshine Coast

NSW Mid North Coast

RISING MARKET Adelaide

Burnie/Devonport

Canberra

Cairns

Melbourne

Echuca

Hobart

Launceston

Ballarat

Mount Gambier

Bendigo

Tamworth

START OF RECOVERY Brisbane

Horsham

Bundaberg

Mildura

Emerald

Townsville

Hervey Bay

Whitsundays

MEDIAN HOUSE AND UNIT PRICES $1,100,000

Type Median value

Quarterly

12-month

growth

growth

Canberra

H

$648,000

4.5%

4.2%

Canberra

U

$425,500

-2.2%

0.7%

28

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Sydney Melbourne Brisbane Adelaide

Perth

Hobart

$582,500

$300,512

$367,000

$388,000

$0

$500,000

$100,000

$330,000

$200,000

$440,000

$300,000

$399,500

$500,000 $400,000

$509,000

Canberra is becoming an expensive city for tenants.

Findings presented in the Domain Rental and House Price Report released in February 2017 suggest the rate of increase in rental rates in Australia’s political centre was the highest of all the other state capitals.

Factors playing into this upswing include development efforts, political stability, and greater job security for those working in government. In fact, wages have been high, but the increased cost still puts a strain on tenants.

For Nicola Powell, data scientist at Allhomes, this rise is indicative of a resurgence in investor activity.

“As affordability becomes stretched, some tenants will be forced to move in search of a lower price point,” Powell points out.

“Tenants need to brace themselves for further potential price hikes. Vacancy rates remain low, indicating more hikes to rent could be possible, pushing the journey to home ownership further out of reach.”

$550,000

$700,000 $600,000

$710,000

$800,000

Tight vacancy rates and high demand raise prices

$737,000

$900,000

$1,005,000

AUSTRALIAN CAPITAL TERRITORY

Area

Houses

$1,000,000

Darwin

Units

$383,564

Following its gradual improvement in 2016, Adelaide looks set to maintain the positive growth of its housing market.

Gregg Harris, general manager of NAB Retail, credits this to South Australia’s burgeoning economy.

“High-performing hospitality and education sectors, as well as government announcements aimed at stimulating jobs and economic growth, have been influential in the house price increase,” he explains.

Nonetheless, the growth rate is expected to be slower than it was over 2016 because of unemployment rates that remain stubbornly high, and a weak commercial scene.

“Employment security, along with price levels, is one of the biggest constraints on South Australian buyer activity,” Harris says.

Rental yields in the state are expected to drop as well, although they will remain higher than the average returns in Sydney and Melbourne.

According to a survey conducted by NAB Economics on industry experts’ thoughts regarding the local property market, the opinions on SA improved significantly in the final quarter of 2016.

Area

APPROACHING PEAK OF MARKET

$640,000

Adelaide basks in positivity as a strengthening economy boosts the housing market

$345,000

SOUTH AUSTRALIA

Canberra

*All data to week ending 23 April

CAPITAL CITY HOME VALUE CHANGES CAPITAL CITY

WEEKLY CHANGE

MONTHLY CHANGE YEAR-TO-DATE CHANGE

12-MONTH CHANGE

Sydney

-0.4%

-0.3%

5.0%

16.2%

Melbourne

-0.1%

0.8%

5.3%

16.3%

Brisbane

0.4%

1.0%

1.3%

4.5%

Adelaide

0.2%

1.2%

3.0%

3.6%

-0.4%

-1.3%

-2.4%

-5.8%

-0.2%

-0.2%

3.9%

11.8%

Perth COMBINED 5 CAPITALS

*Brisbane results are for the combined Brisbane and Gold Coast region. The monthly change is the change over the past 28 days.

Source: Herron Todd White – www.htw.com.au

PEAK OF MARKET NSW Central Coast

Peak of market

Coffs Harbour Newcastle

Starting to decline

Approaching peak of market

STARTING TO DECLINE Toowoomba

Rising market

DECLINING MARKET

Declining market

South West WA

APPROACHING BOTTOM OF MARKET

Approaching bottom of market

Start of recovery Bottom of market

Perth

Gippsland

Alice Springs

Rockhampton

BOTTOM OF MARKET Darwin Gladstone Mackay

TASMANIA

Strong growth and affordability define the Apple Isle’s property market Hobart remains the most affordable capital city in Australia, despite recording strong results in 2016 in terms of growth.

Cameron Kusher, research analyst at CoreLogic, notes that during the January 2017 quarter, Hobart’s property prices increased the most among the capitals, with a nearly 6% rise. Part of this growth has been instigated by low stock in the city. Indeed, the amount of new supply on the market is significantly lower than 2016’s.

“Given the amount of stock listed for sale is likely to rise, it will be interesting to see how quickly it lifts and how it compares to stock levels from a year ago, which were already considered to be quite low.”

Area

Type

Median value

Quarterly growth

12-month growth

Hobart

H

$390,000

5.4%

4.5%

TAS Country

H

$269,000

5.5%

0.0%

Hobart

U

$295,000

3.5%

3.0%

TAS Country

U

$226,000

2.7%

-2.9%

Source: All data sourced from CoreLogic.com.au, except where otherwise stated

www.brokernews.com.au

29

PEOPLE

IN THE HOT SEAT Gabrielle Aoun was inspired by her mother to become a broker, but this ambitious 23-year-old is forging her own path at Rate Comparison, with her sights set on becoming one of Australia’s top 100 brokers Who or what inspired you to become a broker?

Having a background in insolvency and corporate restructuring A gave me insight into how honest people could succumb to peril from overly ambitious borrowing and poorly structured finance.

Unfortunately, in most cases, it was too late to restructure their finances. I saw an opportunity in broking to give people peace of mind and the chance to find a product that would benefit them. My mother, who has worked in the finance industry for more than 13 years, was a major inspiration. So far the industry has not disappointed. I am loving all that I’m learning.

Q

How has being a woman in broking influenced or shaped the way you approach the industry?

Growing up with a hard-working, independent mother, there was A never any segregation of ‘man’s work’ and ‘woman’s work’ in our household. I was raised to apply myself to my goals with an unfettered belief in my abilities. This wasn’t always easy as I struggled with self-doubt; however, Mum was quick to put me back in line. I believe all people should strive for the same, regardless of gender, and remain focused no matter what obstacles or distractions come your way. It’s clear the broking industry is male-dominated, although, while women are outnumbered, the women in the industry are incredibly supportive.

Q

What is something you’ve dreamed of doing but haven’t got around to yet?

I’ve always wanted to see where my dad and his family were born A in Lebanon. This will soon become a reality as my tickets have been booked for this July. My next goal is to make MPA’s Top 100 Brokers list in the very near future.

Q

What do you think are the most interesting things going on in the mortgage space right now?

The hot topic at the moment is affordable housing. There is a lot of A pressure from the government to cool down the market; however, there are a lot of viable and developing financing options, such as affordassist.com, a no-deposit assistance scheme that allows first home buyers to get their foot in the door. I am keen to do more work in this area of lending and use my skill to guide first home owners towards an affordable and realistic purchase strategy.

Q

Who was the last band/musician you saw live, when was it and how were they?

I was lucky enough to see Coldplay on their last Sydney tour. The A band’s stage presence and energy is really something to admire. I’d love to have that kind of liveliness on a Monday morning; unfortunately, the almond milk lattes don’t seem to have that effect on me.

Q

30

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