Over half of Australia’s mortgage brokers expect a rate rise this year
A survey of mortgage brokers from Australia’s leading mortgage broker platform Hashching has revealed that over half (55%) of respondents felt an interest rate rise was likely this year.
The survey also found that brokers still see the interest rates they can provide to customers as the number one reason their customers come to them (59.26%), over any other factor including customer service (11%), Loan flexibility (3.9%) or custom loans (11%).
With most major banks increasing their fixed mortgage rates already, it’s a prediction that centres around not what the RBA does, but what the market will do, according to Hashching CEO Arun Maharaj, who stated, “Brokers are still seeing themselves as a portal to better interest rates for their customers. This is actually quite a pessimistic view of the profession – and one that means that if interest rates do rise, brokers will start to feel under pressure to demonstrate value.
“We’re also seeing that despite the pandemic, there’s still over a third (37%) of brokers not utilising video calling technology for client interactions. This data was gathered before the NSW lockdown, so it will be interesting to see if that changes. It has to be said that the majority (55%) are indeed using modern technology like video conferencing to make client interactions easier, which is pleasing to see.”
Finally, when surveyed on refinancing activity, mortgage brokers indicated that refinancing is increasing for a sizable minority of brokers (44%) but the majority (56%) aren’t seeing more than they typically would for this time of year. Only 18% of brokers expect the market to get hotter by the end of December, with the majority of brokers expecting it to stay the same (48%) or start to cool (33%). This more pessimistic view of the market would imply that brokers don’t see a major reason for celebration from the recent Federal Budget announcement.
Maharaj concluded, “We’re not too surprised to see the ‘great refinancing’ alluded to in the media not really come to pass. This is still a conservative time for many, and that will be reinforced by the NSW lockdown. Brokers are expecting the market to either cool or stay the same for the rest of this year, and they’re not often wrong in their predictions on this front, given their proximity to the heart of the industry. That’s good news for first home buyers, and bad news for the government hoping to use the industry to kick-start the Aussie economy. But only time will tell!”
