A Perth mortgage broker has argued brokers who are not proactively looking after their existing book of business are likely to begin losing clients to other brokers as customers seek to refinance.
Joshua De Buelle (pictured above), principal of Perth brokerage FiNEXT, said he and his team had started the year with a strong focus on being very proactive with its existing database of customers.
“Being proactive with your database is crucial at the moment because refinancing is at an all-time high. You have to look after your book otherwise you will end up bleeding clients,” De Buelle said.
Not being proactive could mean losing customers to other brokers, he said, and it was imperative that brokers who wanted to retain clients were as proactive with their database as possible.
For FiNEXT, that has translated into a customer campaign focusing on “a couple of hundred or so” customers who are due to come off cheaper fixed rate loans over the next six months.
“We’ve emailed them all to let them know they are coming off of their fixed rate. We tell them we will be in touch with their bank to find out what their options are, and that we will be coming back to them with a strategy on what they can do next,” De Buelle said.
“These customers are worrying what coming off their fixed rate loan will look like, so we are getting in front of that, and being proactive about finding them the most suitable solution.”
FiNEXT’s campaign has been generating “great feedback” this year, as its customers realise they are being actively taken care of by their broker as they reach key milestones in their financial lives.
Consolidation and housekeeping a focus
FiNEXT is seeing a lot of loan reviews and refinancing work as the brokerage helps both owner-occupiers and investors adapt to their changing situations in a rising interest rate environment.
De Buelle said business was about 30% up year-on-year in January and February, reflecting the general rise in buyer interest that top Perth brokers have been seeing in the year 2023.
Investors were reviewing their loans and looking at costs as much as anyone, he said, and were currently restructuring their finances as they came off fixed rate or interest only periods.
However much of De Buelle’s business is with owner-occupiers, and for that market segment, a change in the Home Guarantee Scheme has driven strong business from first home-buyers.
“The government’s decision to increase the price cap for first home-buyers to $600,000 has been a huge game changer – it was previously too low, and not a lot of people could use it,” De Buelle said. “We are seeing a lot more of that at the moment, and it is clearly the best option for first home-buyers and even single parents to get into the market.”
Western Australia should also look at other barriers to entry for first home-buyers, De Buelle argues, including raising the current stamp duty exemption threshold from $430,000.
“The average first homebuyer in WA isn’t getting any government benefits other than what’s on offer under the Home Guarantee Scheme,” he said.
“The majority of first homebuyers are not getting the benefit of from a reduction in stamp duty, because the properties being purchased are above that threshold.
“That means a first home buyer trying to buy into the market at $600,000 will have to pay close to $25,000 on top of having a 10% deposit to qualify for a loan from the bank.
“You’re looking at almost $100,000 and it’s hard to get that money together. We are seeing a lot of mums and dads giving gifts; the guarantee scheme has been a lifesaver for a lot of people.”
In other initiative, FiNEXT produced a video series to “spread the message as much as it can” about how people can utilise these types of measures to get into the market as prices increase.
