Now is the time for brokers to innovate and set themselves apart, says industry executive
No mortgage professional in Canada needs to be told that the market has witnessed a protracted slowdown in 2022 as rising interest rates pour cold water on the country’s housing and mortgage boom of the past two years.
Shortly after the COVID-19 pandemic struck in March 2020, homebuying activity across the country shot through the roof, with mortgage brokers and agents facing unprecedented demand for their services as Canadians sought to avail of record-low rates.
That surge has slowed this year amid rate hikes on both the fixed and variable sides, and sales activity is likely to continue moderating throughout the second half of 2022.
Of course, as many have pointed out, the current shift in homebuying activity could simply reflect a return to a more normal market after two years that were almost without precedent in Canadian history.
It could also present brokers and agents with a valuable opportunity to refocus and build business in a way that will set them in good stead for the future, according to a mortgage professional whose work covers a large and busy region.
Scott Wittrup (pictured top), regional manager for the Greater Toronto Area and Atlantic Canada at InvisMI, told Canadian Mortgage Professional that many successful brokers were now revisiting clients who had found themselves frozen out of the market during the frenzied bidding wars of the past two years, but may now be able to take advantage of a cooler climate.
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Rapid house price appreciation has stopped in many markets, although prices are still almost uniformly far higher than they were at the same time last year. “However, there aren’t as many bidders, so that’s making it a little bit easier for those clients who lost out last year and the year before,” Wittrup explained.
The fact that properties are selling for listed price, or marginally over, means that those buyers who are still in the market but previously found their budgets stretched may now be able to find something that works, he said.
While marketing has always been an essential part of the mortgage broker’s role, it’s set to become even more critical for driving new business – and establishing a prolific, prominent social media presence is one of the best ways to do that, according to Wittrup.
“Focusing on social media and online marketing is the most important it’s ever been,” he said. “Before, I heard some people say, ‘Well, I don’t have time to market, or if I do, I have too many clients.’
“Now they’re coming back and saying: ‘What’s a good marketing plan? What’s a good social media and SEO plan?’ We’re finding ourselves really guiding a lot of brokers right now on their marketing, and brokers are becoming more aware that marketing is going to be more important.”
That also presents an opportunity for brokers to establish themselves to an enormous potential client base as a source of expertise in the industry, Wittrup said, particularly as the mortgage market grows even more complex in the rising-rate environment.
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“During this time where it might be a bit slow, market yourself, get yourself out there, and if you didn’t have time for it before you might have more time now,” he advised.
It’s an oft-repeated cliché that the pandemic accelerated the usage and uptake of technology in the mortgage industry and market, allowing prospective borrowers to look for a mortgage from the comfort of their own home and interact with brokers and other parties to the process in a fully virtual manner.
A focus on enhancing and streamlining the use of technology can help keep brokers ahead of the game, Wittrup said, as modernization and new advancements continue to drive the mortgage process.
“That will allow [brokers], when things do turn back to normal, to have the ability to have some updated technology and automation for them to use to help their clients, or increase the amount of clients they have, without the extra paperwork,” he said.
Ultimately, now is the perfect moment for brokers and agents to get creative, according to Wittrup, and work on developing a value proposition to deliver as effective and comprehensive a service as possible.
“Now it’s time to go back to what’s going to make you different from the next person,” he said.
