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New research has shown a big jump in investment loans and the potential revenue boost they can offer brokers.
According to Roy Morgan Research, investment loans have increased by 37 per cent since 2010, compared to only 4 per cent growth in the owner-occupied market.
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Vision principal Matt Ivers said the growth in the investment market represented a big change from a few years ago when first home buyers were the go-to client.
“It’s not like it was in the early 2000s. There definitely seems to be an archetype for people to invest now,” he told The Adviser.
“In 2008, no one was investing; everyone was nervous. But now we’ve got low rates and good yields, so it makes sense for people to do it.”
Mr Ivers said that with the huge benefits delivered by the investor market, it made sense for brokers to diversify their list of services.
“I’d be surprised if brokers weren’t involved in investment services. I’d imagine if they’re not, they should definitely have a mix of it,” he said.
Paul Eadon of Eadon Home Loans also said mortgage brokers should be sharply tuned into the investor side of the market.
“It’s just part and parcel of what we do. Brokers should be all over strategies, investment and financial planning,” he told The Adviser.
According to the Roy Morgan report, 11.9 per cent of people aged from 50 to 64 hold an investment property loan, compared to 9.4 per cent in 2010.
The share of investors in the 35 to 49 age group has also increased, from 8.5 per cent to 11.3 per cent.
Roy Morgan also found that while the proportion of people aged between 50 and 64 with owner-occupied loans has risen from 31.6 per cent to 34 per cent, the figure for the under-35 age group has gone down.
The data follows a recent statement from the Reserve Bank of Australia cautioning first home buyers about entering the market while conditions favour investors.
