An education-driven approach – and a realistic outlook – are key factors in 2024, says VP
After a muted year for Canada’s mortgage market in 2023, it may be tempting for agents and brokers to forecast a much-improved outlook for the 12 months ahead – but it’s important to inject a strong dose of realism into those expectations.
That’s according to Scott Wittrup (pictured), regional vice president for the Greater Toronto Area (GTA) and Atlantic Canada at Invis Mortgage Intelligence, who told Canadian Mortgage Professional that brokers shouldn’t take as a given that imminent interest rate cuts will spur a big market upswing.
With that in mind, he said 2024 is a year that’s likely to be defined by an advice-driven approach, rather than a heavily transactional one, for Canada’s agent and broker community.
“I think this next year is going to be a big one for us to educate clients and market yourself,” he said. “Next year is [about] bringing information, in my opinion. So when you want to get out there, when you’re marketing yourself, market information [and] back up your sources.
“People will start to listen, and people are very interested in what’s going to be the most accurate information they can follow. Get some videos out there yourself talking about some of the actual realities that are happening, weekly updates telling people what’s happening, and you’ll have your following come to you for all the information they need.”
How agents and brokers can set up for a better market ahead
The end of the current market downturn may not take place right at the beginning of 2024 – but with busier times expected to emerge when rates start to fall, agents and brokers have an opportunity at present to establish themselves as a trusted source of information, according to Wittrup, and position themselves well for when the market does turn.
The Canadian economy is likely to see a moderate recession, stemming from rising debt service costs due to mortgage renewals, until mid-2024, according to a new analysis by Oxford Economics.
— Canadian Mortgage Professional Magazine (@CMPmagazine) January 4, 2024
Read more: https://t.co/rPXRtrWE5w#mortgagenews #economicoutlook #recession #mortgage
“I think that’ll be a big factor when it comes to people jumping back in the market: the people that were honest with them and the people that had a very good idea of what was actually happening, and what trends were going to be, rather than people just saying, ‘Things are back again – here we go,’” he said. “Information is very important this year.
“It’s time for us to be honest with everybody, and that’s the way that clients will start appreciating your opinion on things and come to you for future references – because 2025 and 2026, I think, are two years where it’s going to be pretty crazy again.”
Those mortgage professionals who weather the current market headwinds will emerge the better for it on the other side, Wittrup said – particularly as others exit the agent and broker professions.
An upcoming wave of mortgage renewals, a much-publicized trend that will see scores of Canadian borrowers renew their mortgage at much higher rates than their original deal, is just one of the reasons agents and brokers need to double down on that advice-driven approach for the year ahead, according to Wittrup.
“You’re going to have to make sure that you’re working extra hard on your renewals, touching base with your clients at all times, and making sure you have all the options available that will give them a better opportunity than just the one option that the lender or the bank can offer,” he said.
“Go back to your toolbox and find out everything you can about all the selling products you can offer, and utilize those to help your clients make an educated decision on the renewals that are coming up. So that’s a big deal.”
Broker-client relationships as vital as ever in 2024
Ultimately, while brighter times are certainly on the horizon for Canada’s mortgage market, much of 2024 is likely to see challenges for homeowners and new buyers in equal measure, meaning it’s essential that agents and brokers focus on relationships and steering their clients through difficult and troubling times.
“Clients are going to be looking to us as professionals to give them the best options, and that will be dictating exactly the future of the relationship that they have with you going forward,” Wittrup explained.
“So it’s important to have everything ready for your clients and when the renewals come, and you have to be ready to give them the right information and the right suggestions and offers, make sure you’re on top of it.”
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