Director of Sydney's Concord-based Anasta Finance Consulting Andrew Kelly is confident his expertise in commercial lending positions him well to ride a recent thaw in the market.
Having left the banks seven years ago when he saw an opportunity to fill a poorly served commercial market, Kelly said his expertise is concentrated in the commercial area.
However, the GFC fallout meant the market has been “a little light” over the last few years, and the business had seen a shift to servicing 80% residential clients, 20% commercial.
But Kelly said the commercial market is reviving. The last six months have seen the Anasta business swing back the other way, with only 60% of business written for resi clients.
“Commercial enquiries have lifted, and we are seeing more enquires for owner-occupier purchases,” Kelly says. “The bulk of my clients are self-employed, and commercial property prices have not spiked. There are a lot of people who were renting who have decided to purchase, because rents keep rising but the value of commercial property hasn’t.”
The result is that Kelly is upbeat about the rest of this y ear. “I’m cautiously optimistic. I expected a slow down before 30 June, but that hasn’t happened – it has changed, but it hasn’t slowed, probably because of my more mature client base and referral partners,” he explains. “I don’t think it is going to stop – interest rates are still terrific, but it’s all about confidence.”
This is not to say that his client base isn’t hurting. In fact, Kelly said that he is seeing a second wave of clients coming to him to help with troubled financial situations.
“Before the GFC, I probably would have gone five years without an enquiry from a client in trouble,” he says. “But after that, there were enquires from clients in financial distress. Now, there is another wave of clients I’m being asked to help who I didn’t expect to see.”
Kelly said that much of this wave was coming from residential clients, and that it was “nigh on impossible” to refinance clients in residential distress situations. He blamed bank credit policies that had allowed first homeowners to borrow more than they could handle.
Going forward, Kelly said he would continue to focus on his existing clients, and maintaining relationships with four accounting firms from which much of his business comes. He said the key to maintaining these over a long period of time had been constant contact.
“It is all about contact, giving them the time they need, working outside the hours; it’s about providing different choices and working with them to get a result.” Kelly said bank credit areas can be reluctant when things slow down, and a good broker is able to think outside the square and provide a really good reason as to why a bank would and should finance a loan.