Jackson Hunter set up his mortgage brokerage Finance House 18 months ago in Waterloo.
He had moved back into finance after his business in the entertainment industry became a COVID-19 casualty.
Finance House has had an incredibly successful start, which founder Jackson Hunter says comes down to great customer service. His firm has serviced over 70 clients since inception including some from Clark Estate Agents. Jackson works with people from all walks of life including clients from interstate. But he prefers to work in his local area of Waterloo as he says it has everything you need within a 5km radius.
Hi Jackson, what’s your take on the real estate current market?
I think the market finally hit its peak a few weeks back when the mad rush petered out. There had been a lot of ‘panic buying’ with plenty of first home buyers entering the market. But that has cooled off and we’re seeing a real shift to people refinancing.
What’s the biggest issue for lenders?
The biggest issue for lenders is neo banks and competition from faster, more agile lenders who are popping up every other week. This trend is also pushing the larger lenders to update their backend process which is a plus for both brokers and clients.
And on the customer side, what about the biggest issues for buyers?
I think the biggest issue for buyers right now is low stock availability and record low-interest rates which continue to push up property prices.
What are your thoughts about the price rises?
It’s been a wild boom. And as much as I’d like to say it’s over, I think we will continue to see prices head north. I do believe the largest hike is behind us and it will be a slower incline until the end of this COVID-19 period. What happens after that is anyone’s guess.
How is COVID-19 impacting the lending market?
Initially we saw lenders tightening their policies and assessment times were seriously affected. We’re now, thankfully, seeing these numbers returning to pre-COVID levels, and many lenders focusing their attention to internal processes and their turnaround times.
What do you think the future holds?
Fixed interest rates have already gone up and will probably continue to do so. We got a notification that one of the major four banks has increased their four and five-year fixed rates by 30 basis points or .3% which is a big difference.
Thinking of selling?
How do you guard against interest rate increases?
People often don’t know that the RBA cash rate and fixed interest rates move independently of one another. Fixed interest rates reflect the cost to a bank of locking in funds for a set period. So, check your home loan rate sooner rather than later, and lock in a great fixed rate before they rise.
Any tips for buyers when it comes to processing a loan application?
Get a pre-approval before you buy, and don’t fudge the numbers. Know your monthly expenses, and be as open and honest with your broker as you can. Also, don’t take an online calculator as gospel. Get a qualified mortgage broker to give you an accurate analysis of your purchasing power.
What is the biggest mistake you’ve seen buyers make?
Over inflating their purchasing power and getting a property valued prior to exchange. If another buyer comes in with a higher offer you’ve limited yourself to the bank’s valuation. Instead, try to get a cooling-off period and use this to complete a valuation once the price is finalised.
Are we seeing more investors in the market?
I think we are now. There has been a shift with more coming into the market.
What are the challenges for First Home Buyers?
The initial deposit is always a big one. They need a good financial strategy in place to get ahead. It’s also hard for buyers as the goalposts keep shifting, plus they don’t really have anyone on their side. The agent works for their vendor, so it helps the buyer to get a neutral opinion. Mortgage brokers can offer some of that neutral opinion and advice.
What value can a mortgage broker add to the purchasing journey?
Mortgage brokers have the ability to negotiate using other lender offers as leverage. We cut out the guesswork and make policy-backed recommendations so customers apply with a lender that will approve their loan. We recommend structures and products consistent with property specific goals and risk appetite. We compare over 35 or more lenders instantly, so you know you are getting a complete market snapshot.
Thanks for the chat, Jackson, and good luck growing Finance House.