The Australian mortgage broking market
Property is a major asset in Australia and many people aspire to the dream of ‘owning their own home’. A large number also build a property investment portfolio, by adding another or multiple investment properties.
For the 12 months ending 30 June 2009, Mortgage Choice customers had $10.1 billion in home loans approved, which was a reduction of 8.2% on the previous corresponding period. The total mortgage market over that period also experienced a reduction in new housing finance commitments, to $241 billion*.
Much has been written about the state of the housing market. Although we are probably facing a slow rise in interest rates over 2010, borrower demand is still healthy (and we predict it will remain so) thanks to Australia's undersupply of housing, strong population growth, low rental vacany rates and high rental prices.
The growth prospects of the mortgage broking industry are looking positive. A July 2009 report by Genworth Financial confirmed its strong position, saying the proportion of broker originated home loans is now 41% of all new housing lending volumes. This is a great achievement for an industry less than two decades years old.
The mortgage broker proposition is appealing to all participants i.e. the consumers, the lenders and the brokers themselves. There is no doubt the consumer is the winner and has driven the growth of the industry against a backdrop of a complex array of product offerings.
The predicted growth of the mortgage broking industry lends itself to an exciting future where expert knowledge, convenience and choice of property loan advice will become the standard by which borrowers assess their home loan needs.
* Australian Bureau of Statistics, Housing Finance for Owner Occupation Report, 5609.0