Australian Broker magazine Issue 10.05

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The no. 1 news magazine for Australian brokers.

Text of Australian Broker magazine Issue 10.05

  • Mortgage broking is in need of new blood, and Citibanks head of mortgages says the career path must be made clear FULL STORY PAGE 14

    INSIDE+POST APPROVED PP255003/06906 MARCH 2013 ISSUE 10.05$4.95

    + ANALYSISCRYSTAL BALLNABs John Flavell on where the economy is headedP12

    The mortgage broking industry is ageing. With many seasoned brokers headed toward retirement, its crucial that talented new entrants are drawn to broking as a career. But Citibanks head of mortgages Vibha Coburn has said that the industry must make the path clear, and provide options that appeal to a variety of would-be brokers.

    + MARKET TALKHELP FROM ABROADWhat Australia can learn from SwedenP20

    +WORKSHOPUNTANGLING THE WEBBuilding a dynamic website made simpleP18

    VIBHA COBURN: Making the path clear

    + NEWSA look at whats been making headlinesP4

    + AXE TO GRINDIN DEFENCE OF BROKERSA NSW broker takes aim at the criticsP22

    + CAUGHT ON CAMERAON THE ROADNAB Broker takes its pitch cross-countryP29

  • NEWS2 brokernews.com.au

    NUMBER CRUNCHING WHAT THEY SAID...

    VIVIAN WANG More and more Chinese

    are shifting their wealth to Australia

    through property investment

    P21

    TONY MACRAEIt's short-sighted of any lender to rely on either fixed or variable rates to run their business P27

    Source: Dun & Bradstreet

    JOHN FLAVELLPeople are not confident to go out and leverage themselves P13

    DID YOU KNOW?

    9.3 yearsThe average length of ownership for a houseSource: RP Data

    ON THE UPAuction clearance rates improving

    FIXED RATES, VARIABLE DEMANDFixed rates as a proportion of loan approvals: February

    of Australians expect house prices to rise in the coming six months

    expect prices to rise in the coming 12 months

    CITYCLEARANCE RATE WEEK OF 9 MARCH

    SAME WEEK LAST YEAR

    Sydney 72.7% 54.5%

    Melbourne 61.2% 54.2%

    Adelaide 58.8% 26.7%

    Brisbane 44% 32.9%

    Source: Australian Property Monitors

    Source: Mortgage Choice

    19.94%NSW

    15.74%WA 23.05

    %

    QLD

    11.08%VIC

    18.16%SA/NT

    38%

    51%

  • NEWS4 brokernews.com.au

    EDITOR Adam Smith

    PUBLISHER Simon Kerslake

    COPY & FEATURES

    JOURNALIST Mackenzie McCarty

    PRODUCTION EDITORS Carolin Wun, Moira Daniels

    ART & PRODUCTION

    SENIOR DESIGNER Rebecca Downing

    DESIGNER Ginni Leonard

    SALES & MARKETING

    SALES MANAGER Simon Kerslake

    ACCOUNT MANAGER Rajan Khatak

    MARKETING EXECUTIVE Anna Keane

    TRAFFIC MANAGER Abby Cayanan

    CORPORATE

    CHIEF EXECUTIVE OFFICER Mike Shipley

    MANAGING DIRECTOR Claire Preen

    CHIEF OPERATING OFFICER George Walmsley

    MANAGING DIRECTOR BUSINESS MEDIA Justin Kennedy

    CHIEF INFORMATION OFFICER Colin Chan

    HUMAN RESOURCES MANAGER Julia Bookallil

    Editorial enquiriesAdam Smith tel: +61 2 8437 4792

    adam.smith@keymedia.com.auAdvertising sales

    Simon Kerslake tel: +61 2 8437 4786simon.kerslake@keymedia.com.au

    Rajan Khatak tel: +61 2 8437 4772rajan.khatak@keymedia.com.au

    Subscriptionstel: +61 2 8437 4731fax: +61 2 9439 4599

    subscriptions@keymedia.com.auKey Media

    keymedia.com.auKey Media Pty Ltd, Regional head office, Level 10, 1 Chandos St, St Leonards, NSW 2065, Australia

    tel: +61 2 8437 4700 fax: +61 2 9439 4599

    Offices in Singapore, Toronto, New Zealandbrokernews.com.au

    Copyright is reserved throughout. No part of this publication can be reproduced in whole or part without the express permission of the editor. Contributions are invited, but copies of work should be kept, as Australian Broker magazine can accept no responsibility

    for loss.Australian Broker is the most-often read industry publication,

    according to independent research carried out by the Ehrenberg-Bass Institute for Marketing Science at the University of South

    Australia in December 2008.The research also found that brokers rate Australian Broker as the best for both news content and feature articles, followed by sister

    publication MPA. Overall, on all categories, Australian Broker ranks top followed by MPA. The results were based on a sample

    of 405 respondents who were the subject of telephone interviews.

    brokernews.com.au

    Positive reporting not a negative

    Tsunami of Diplomas

    The impending positive credit reporting regime will be a boon to consumers, says Experian Credit Services Australia managing director, Genevieve Juillard.

    Global credit reporting agency Experian has launched in Australia ahead of the positive credit reporting regime due in March 2014. While some industry figures have warned the system could lock borrowers out of credit, Juillard said consumers stand to benefit. It provides empowerment in terms of the dialogue between the customer and the credit provider and provides the ability to ensure the consumer accesses the credit most appropriate to them.

    The MFAA sorted through a tsunami of broker qualifications following Januarys Diploma deadline.

    MFAA CEO Phil Naylor said the association is now dealing with the influx of correspondence from brokers who completed the Diploma.

    Its gone really well. The deadline was 31 January, and as you can imagine, weve had a tsunami of emails from people providing evidence that theyve obtained the qualifications.

    The MFAA last year extended the deadline for the Diploma due to a massive backlog in processing last-minute enrolments. With the extension in place, Naylor said the majority of brokers had completed the qualification.

    FIXED RATE BORROWERS VULNERABLE

    Financial comparison site RateCity claims borrowers only had a 30% chance of saving money by fixing for three years between 1990 and 2010 and were also likely to save more money by staying with average variable rates compared to average three-year fixed rates.RateCity spokesperson, Michelle Hutchison, said the study shows the vulnerability borrowers face when locking in a fixed rate home loan.Borrowers have to be particularly savvy and time it right to save money by fixing their mortgage, as its more likely that they will lose out by fixing.

    of the 816 distressed properties advertised for sale nationwide in 2012 were in Queensland.

    DID YOU KNOW?

    50%

    19600

    1

    2

    3

    4

    5

    6

    1970 1980 2000 2010

    HOUSING PRICE TO INCOME RATIO 1960-2012

    Source: ABS, Stabledon

  • 6 brokernews.com.au

    NEWS

    THE STRANGER SIDE OF NEWS

    NICE DAY FOR A CHEAP WEDDING Greece has had its fair share of troubles, with the countrys economy dragging much of Europe with it into the vortex of recession. Austerity measures doled out by the government have hit a lot of Greek citizens hard, but perhaps few harder than would-be brides. Evidently, fewer Greeks are choosing to get married as the countrys financial crisis puts the squeeze on their traditionally lavish weddings. The number of couples choosing to get married fell from 40,000 in 2008 to 28,000 in 2011. Meanwhile, low-cost civil unions grew from 8,000 back in 2001 to 26,000 in 2011. Of course, My Small, Skinny Greek Civil Union doesnt have quite the same ring to it.

    MOPE-TOWN Sydney and Melbourne may find themselves perennially among the list of the worlds most expensive cities, but they can take comfort in the fact that theyve escaped one dubious title. Forbes has named Detroit the most miserable city in the United States. With high crime, a dwindling population and an economy in shambles, Detroit unseated Miami which held

    the title last year as the most unpleasant city in America.

    In spite of a drop in violent crime, Detroit still maintains the highest rate in the country. The housing industry has been hit hard in the city as well, with home prices down 35% over the past three years.

    FAST FACT

    20 Hours per month that financially-stressed employees spend trying to solve their financial problems while at work

    The death knell has been sounded for the Australian dream of home ownership following a troubling report on housing supply.

    Property Council of Australia has pointed to a report from the National Housing Supply Council as evidence that the dream of buying a home is quickly fading for many Australians.

    The NHSC report found a high level of pent-up demand for affordable housing, and said affordability pressures are pushing a marked increase in the number of young adults living in the parental home.

    As time progresses, it now seems certain that the aggregate rate of home ownership will drop and the proportion renting will increase significantly, the report said.

    Residential Development Council executive director Caryn Kakas said the report signalled a troubling shift.

    The forecast increase in the proportion of households renting signifies the death of the great Australian dream of home ownership for many Australians, Kakas said.

    The HIA echoed Kakas remarks, saying that housing would continue to become less affordable without government intervention. HIA chief executive

    Dreams of home ownership dying

    DUMPSTER DIVING

    Bank branches are the worst offenders when it comes to leaving confidential client information vulnerable to theft, according to detective work carried out on the part of the National Association of Information Destruction (NAID-ANZ).

    An investigator hired by NAID-ANZ went through the contents of publicly accessible waste bins used by 80 Sydney businesses.

    Shockingly, 40% of bank branches were found to have dumped confidential documents into easily accessible and non-secure rubbish bins.

    On the other hand, none of the mortgage brokerages searched were found to have dispos