Supply issue should have been dealt with long ago, according to CIMBC CEO
While the impact of proposed hikes to the mortgage stress test rate remains to be seen, there is “no easy solution” to the question of what to do with the red-hot Canadian housing market, according to Coalition of Independent Mortgage Brokers of Canada (CIMBC) CEO John Bargis (pictured).
Bargis, who will present a panel discussion at this week’s Canadian Mortgage Awards on April 29, told Mortgage Broker News that amid concerns about the risk of a housing bubble, the issue of lack of supply in the market was one that should have been prioritized from the outset.
“There are more than enough data points to rely on that give rise for concern on what may lie ahead for the real estate market,” he said. “Many experts, economists and levels of governments would argue [that it] is at risk of being in a bubble waiting to burst.
“We do have to be mindful of the impact COVID has had on the entire global economy, and no matter how one slices it, there’s no easy solution to a very complex problem in a record low interest rate environment that should have been addressed long ago on the supply side.”
With such uncertainty about the market outlook for the future, the role of mortgage brokers will arguably assume greater importance than ever – and Bargis said that the profession would see plenty of opportunity in the coming years.
“The broker business will continue to grow and evolve much quicker than it has in the past, especially with the many players in the technology space,” he said. “Those who choose to take the time to think about what lies ahead wisely, with an informed focus on building a sustainable business model, will do very well.”
He warned brokers against adopting an overly “transactional” approach to the profession. “[Those] with a lack of understanding of the need for a well devised strategy will one day wonder why life changed for them as they knew it.”
With speculation rife that further regulation in the broker profession could be coming down the line – a development that Bargis described as “very long overdue” – he said that brokerages needed to be prepared for further changes in store. “My advice to broker owners is to make sure you’re prepared for what’s on the horizon or be prepared to rightfully face the consequences if you don’t focus on managing your business accordingly.”
Bargis will chair a panel discussion at the CMAs linked to the CIMBC Award for Lender BDM of the Year, with the conversation set to focus on some of the challenges and opportunities for BDMs in the current climate. “I’ll address what a BDM looks for in a broker partner to identify a solid business opportunity, and what they feel they have to offer in return to build on that relationship beyond its existing status,” he said.
“Other topics will include education, how dead-end situations are dealt with, and strategies that a BDM might employ to sell their brand versus what the competition has to offer.”
The vital role played by BDMs in the industry, Bargis said, was highlighted during the unique challenges and hurdles presented over the course of the past year. “The ability of BDMs to demonstrate pivotal skills by implementing unique strategies was crucial in the success of the lender partners they’re associated with, as well as their broker clients,” he noted.
The outbreak of COVID-19 and imposition of nationwide lockdowns, he said, meant that businesses had had to swiftly adapt to the new way of doing business, with lenders playing an essential role in helping ease that transition.
“We all had to find different ways of carrying business successfully,” he said, “and that we did, with the help of the quick adjustments made by our lender partners with manageable disruption that the entire industry has learned from.”
The big day is finally almost here! Make sure to register in advance for the Canadian Mortgage Awards on April 29, and stay turned to Mortgage Broker News for all the buildup and news ahead of the mortgage industry’s biggest event of the year.
