Login
ISCOVER
Non-majors continue to grab market share from their larger competitors, according to new research.
The latest AFG Monthly Mortgage Index showed that non-major lenders accounted for more than one in four home loans processed last month.
To continue reading the rest of this article, please log in.
Looking for more benefits? Become a Premium Member.
Create free account to get unlimited news articles and more!
Looking for more benefits? Become a Premium Member.
The index revealed that non-major lenders have increased their collective share of home loans from 20.7 per cent in March to 26.4 per cent in July.
AFG’s general manager of sales and operations, Mark Hewitt, said that this figure, while high, was largely unsurprising.
“This figure may seem unexceptional by international standards, but in Australia more than 90 per cent of all home loans are with only four lenders and their subsidiaries," he said.
“To be seeing competition at this level is encouraging because it offers greater choice and helps keep rates down, both of which are good news for borrowers.”
Mr Hewitt’s comments were echoed by several brokers.
According to broker comments left on The Adviser’s Third Party Banking Report – Non-Majors survey, Australia’s non-majors have improved their positioning in the marketplace of late, helping them to grab a larger share of the mortgage pie.
One NSW-based broker said he was starting to send more business to the non-majors as they improve their pricing and product policies.
“While the big four still monopolise the mortgage market, there is starting to be a swing towards the non-majors, especially as they become more competitive across all metrics, including pricing, policy and service,” he said.
Another broker commented that pricing was a driving factor in his clients’ lender decisions, and that is an area where the non-majors are picking up their game.
“Pricing still seems to be a major driver of customer choice, but thankfully the gap has narrowed in this regard. All things being equal, my preference is to deal with a non-major,” the broker said.
