The secret weapon helping buyers beat interest rate turmoil

Latest research from the Mortgage and Finance Association of Australia shows seven in ten property seekers used the services of a mortgage broker in the June quarter this year.

Mortgage brokers wrote 73.7% of all new homes loans in Q2, according to the MFAA, representing the second highest result on record.

The figure is also a 6.5 percentage point increase from the equivalent period last year, and up noticeably on pre-pandemic levels, according to the findings.

The uptick in the use of brokers comes against a backdrop of continued cautious sentiment driven by an environment of consistently high interest rates.

PropTrack senior economist Paul Ryan says mortgage brokers can help borrowers understand the best options. 

“There have been difficulties with gaining credit and the challenging affordability conditions,” PropTrack senior economist Paul Ryan said. “That naturally makes brokers more valuable to buyers because they have a better idea of what lenders can serve.”

Rates have been held at the above-target level of 4.35% for the last 10 months, with property owners and seekers alike now not expected to see any relief until the new year, after hopes of a November cut were all but dashed by Reserve Bank of Australia governor Michele Bullock earlier this month.  

MFAA chief executive Anja Pannek said the findings that broker usage was up reflected a property market that was continuing to hold strong despite these challenges.

“Mortgage brokers are working every day with their clients to help them get ‘finance’ ready and provide them with a wide range of choices on their home loans,” she said.

Almost three quarters of buyers who secured home loans between April and June used a mortgage broker. Picture: Getty

Melbourne-based Mortgage Choice broker David Thurmond agreed the amount of Australians now using brokers is helping keep the housing market in motion.

The recent high figures of broker business take-up also reflects positively on the industry, Mr Thurmond added.

“The findings are a massive validation for mortgage brokers and the service that we provide clients and the choice that we provide clients,” he said.

There was also an increase in the value of the home loans settled by brokers, the research showed, with the value of home loans settled by brokers in the June quarter this year exceeding $100 billion for the first time.

Mr Ryan said: “Brokers are playing a big part in today’s market, serving different types of borrowers to give them the best outcome when it comes to unlocking that housing dream.”