​Australia’s property boom: what’s happening and what are mortgage brokers saying?

Mortgage brokers see a surge in business as buyers and investors flock to market amidst the property boom.

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As Australia slowly eliminates COVID-19 from within its borders and rolls out a vaccine program, consumer and business confidence progressively improve. Previously, many had predicted poor outcomes for the Australian property market. But, if you look from October 2020 onwards, house prices have begun to shoot up and there are no signs of it slowing down.

Already, homes in regional NSW and Victoria have risen by 11 per cent and 8.3 per cent respectively. This could be partly due to the new work from home model which the pandemic has made possible. Buyers whose employers allow them to permanently work remotely have been leaving the major cities for a change in lifestyle.

During the last few months of 2020, the median price of a standalone house in Sydney rose to $1.21 million. During the same period, Melbourne’s median house price rose to $936,000.

ANZ Bank predicts that house prices will rise to 17 per cent through 2021 at a national level. Meanwhile, Commonwealth bank predicts that Melbourne and Sydney house prices will rise by at least 12 per cent over the next 2 years.

A good year for investors

There are a plethora of reasons why the market is booming and why 2021 will be a very good year for property investors:

• The economy is improving faster than expected and is likely to continue growing through 2021-2022
• Auction clearance rates are strong all over Australia with the national rate sitting at 79.3 per cent
• There is a lack of good quality properties in the market which has created a seller’s market where values of A-grade homes and investment-grade properties are being pushed up because buyers have little choice
• Banks are keen to write new business to help boost the economy which will make it easier for people to get a loan
• The official cash rate has been cut from 1.25 per cent to 0.1 per cent. The RBA guarantees that interest rates will remain low for at least 3 years in order to strengthen economic recovery. This also gives home buyers and investors more confidence to commit to buying

In addition to these factors, the uproar in the media about the housing market is prompting buyers to reach out to mortgage brokers for sound advice. Buyers are experiencing a ‘fear of missing out’ due to the lack of good quality properties – further fueling the boom. In January alone, Australian’s borrowed $28.75 billion to purchase housing – a 44% increase from the same time last year. Mortgage brokers are saying that they are trying to service up to 10 clients at one time. This high demand for mortgage brokers is reflected in the job market.

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The need for more mortgage brokers

Currently, there is a shortage of qualified candidates to fill vacant mortgage broking roles. During a period where there is high demand for mortgage brokers, wealth management companies risk losing potential business where they lack the capacity to take on more clients. To meet demands, employers should consider measures to retain their employees.

In a candidate short market, there are a few things companies can do to retain their current employees, or if need be, attract more talent. Employers need to consider the wants and needs of their current and prospective employees. Many professionals are attracted to opportunities for development and pathways for career development. Others are after a healthy work-life balance, among other benefits. Employers don’t necessarily need to drive up salaries just to keep their employees happy.

Considering what employees want out of their jobs will ensure businesses have the capabilities to meet demands and don’t risk losing talent to their competitors.

Quality talent can also be found in candidate pools which may not usually be considered. At Fuse, we’ve found that graduates carry great potential and a drive that often beats seasoned professionals. Through our Future Insure Graduate Program , we’ve been successful in matching quality talent to the needs of our customers. To learn more about the benefits of hiring graduates, read our blog here .

Advice from mortgage brokers

While banks are willing to lend money due to the low-interest rate, there is still preparation that buyers will need to do to help them secure a loan:

• Gather important documents such as passports, licenses, utility bills (these can help to get your ID approved), payment summaries and bank statements
• People who are self-employed will need their two most recent tax assessments as well as balance sheets
• Those who have changed employers will need to source their new employment contract
• Any receipts to prove what your living expenses look like
• Try negotiating better loan conditions such as reduced fees, a lower interest rate and the option to redraw

Are you a Mortgage Broker looking for your next opportunity? Browse our latest roles here .

Or, if you’re interested in how Fuse’s Wealth Management industry specialists can help your business achieve its objectives through full site talent solutions, fill in the form on this page and we’ll get back to you shortly.