Residex, a well known property research company in Australia believes that brokers should concentrate on mortgage refinance in preference to first home buyer business. has advised brokers to concentrate on people looking to upgrade their home, renovators and investors instead of first home buyers.
Kim Davis, who looks after the firm’s MarketFacts broker service, told Broker News that the upgrader and investor markets have shown strong growth in the last year, and that brokers should concentrate on those markets pretty much to the exclusion of new home buyers.
Australian Bureau of Statistics figures show that the first-time buyer market has fallen to 9% of total secured housing finance from 24% in less than a year, and the figures are still trending down. The main issue with first home buyers is a lack of deposit. Therefore a mortgage broker can spend a lot of time answering queries with no loans actually written
Davis argued that brokers should instead concentrate their efforts on people wishing to upgrade their home or refinance to access equity for renovation and property investors – areas of the market which have shown strong growth in recent months and now represent over 90% of the total value of new and refinanced housing finance loans.
Therefore, she urged mortgage brokers to instead nourish relationships with existing mortgage customers, as well as methods to attract investors, in order to take advantage of the significant activity in those areas of the market.