Regional brokers less impacted by COVID-19

by Madison Utley15 May 2020

While brokers across the capital cities are getting slammed with customers in need of urgent financial help, those based in regional Australia seem to be navigating the current pandemic on more solid footing.   

According to George Smith-Roberts, regional broker of the year at the 2019 Australian Mortgage Awards, business has been booming at his Lismore, NSW brokerage; the activity isn’t only contained to refinancing, but there are still “plenty of sales” coming through to boot.

"We're in a different position being regional. People here are signing up for a lower-value loan, and when loans are smaller, people are a bit more confident about their capacity to repay,” Smith-Roberts explained.

“Our average loan size is around $280,000 to $350,000, and the loan repayments on a loan like this are around $300–$350 per week. This is a lot easier to manage on one income, and people who are picking up the government benefits like JobKeeper and Jobseeker are able to get by a little easier than others [in capital cities].” 

In fact, after the acute uncertainty of the first few weeks of lockdown had died down, some regional brokers even reported borrowers making contact to discuss the opportunities they were seeing open up and strategising how to ensure they were in a place to take action. 

Canberra-based broker Craig Russell of Priority One Lending explained, “I would say for the first two to three weeks, around half the calls I was getting were from people who were in trouble. They had lost their jobs completely or had a significant drop in income.

“The other 50% of enquiries were from people who could see opportunity. They wanted to take advantage of the share market, for instance, so they wanted to refinance and restructure to borrow extra money.”

Tasmania-based Narelle Kerstan from Gloss Finance in Hobart reported a brief lull in business, but is already back to a full load.

“It was probably only quiet for about two weeks. I’ve now started getting refinancing enquiries, and while activity has definitely slowed, I’ve still got more than enough work to keep me busy,” she said.

For Kerstan, hardship loans and applications for deferrals have been a rarity, with just three clients reaching out for assistance in this area since the pandemic began.  

For more on this story, check out Issue 17.09 of Australian Broker – out Monday, 18 May

 

Also in this issue:

Broker Connect 

The virtual event held on 8 May was a hugely successful afternoon, connecting hundreds of lenders, brokers and service providers to discuss how the coronavirus pandemic has changed – and will continue to change – our industry

Is the economy ready to exit hibernation?

At the height of the uncertainty driven by the COVID-19 pandemic, there were fears that the economy could be stalled for at least six months – perhaps longer. Now leading economic experts are suggesting the peak of ‘hibernation mode’ could already be behind us

Broker on Broker

This isn’t the first time Natalie Sheehan, head of distribution at Brighten Home Loans, has witnessed major disruption to the economy and the mortgage industry – and it won’t be the last. She shares her advice and insights to help brokers not just survive the pandemic but come out the other side batting to win