Brokers record highest ever market share amidst tough credit conditions

The mortgage broker channel has recorded its highest ever residential home loan market share result with brokers settling 59.7 per cent of all residential home loans during the January – March 2019 quarter, according to the latest data released by research group comparator, a CoreLogic business, and commissioned by the MFAA.

The March 2019 result is 4.4 percentage points higher than the equivalent 2018 quarter and 6.1 percentage points higher than the equivalent 2017 quarter, continuing the year-on-year trend of growth in the market share for broker originated lending.

MFAA CEO Mike said the result was the strongest customer vote of confidence yet in the mortgage broker channel and is particularly notable given it coincided with the release of the Royal Commission final report and a period of tough market conditions.

“This is a remarkable outcome for the mortgage broking channel. To record the highest market share in the history of this survey during a period of restricted credit highlights the key role brokers have played in driving competition, choice and access to credit by stepping in to find solutions and provide critical assistance in the redistribution of credit demand.

“The fact that customers have continued to vote with their feet during a period that coincided with the release of the Royal Commission final report also highlights the strength of this market share result and sends a strong message to policymakers as to the extent to which consumers value the greater industry experience and choice that mortgage brokers provide.”

Despite strong data on broker market share, the overall value of lending through the broker channel was down $5.249 billion or 11.39 per cent to $40.847 billion year-on-year, compared to $46.096 billion settled in the March 2018 quarter. Although broker originated volume is sharply down, this result needs to be viewed in the context of a weaker overall market which declined by 17.86 per cent from $88.642 billion to $72.803 billion during the period with mortgage brokers continuing to take market share from the proprietary channel.

“Despite the decline in the value of residential lending volumes for this period, brokers have maintained their position as consumer champions. This result clearly shows that mortgage brokers have been able to remain focused on their clients despite all the noise surrounding the industry and continue to deliver unparalleled service and choice to Australian consumers.”

Comparator compiles quarterly broker statistics for the MFAA by calculating the value of loans settled by 18 of the leading brokers and aggregators as a percentage of ABS Housing Finance commitments. The MFAA releases these statistics each quarter. This data can only be used publicly by referencing the MFAA as the owner of the data and its use in communications.