What mortgage brokers should focus on in 2024

Top broker on the keys to success in the coming year

What mortgage brokers should focus on in 2024

The mortgage market of 2024 is just around the corner – and while next year is expected to see interest rates eventually fall, there’s little sign of a dramatic market uptick anytime soon.

Bank of Canada rate cuts are expected to take place around the middle to end of next year, meaning that the housing market’s recent sluggishness may extend through the winter and into the spring until consumers get a hint that borrowing costs could be about to drop.

With the current high-rate environment and tepid market set to prevail at least throughout the early months of next year, mortgage agents and brokers should be keeping plenty in mind for their 2024 plans – particularly deepening relationships with referral partners amid trying times for all.

That’s according to Elan Weintraub (pictured top), co-founder and director of the Mortgage Outlet brokerage, who told Canadian Mortgage Professional that adopting a collaborative approach towards other industry players was a strong way for brokers to build a strong foundation for the future.

“Now is just a really important time to highlight your expertise to your clientele and to your referral sources,” he said. “How can you help people? How can you help your realtors, your financial planners, your real estate lawyers, whatever it is? You have to know them really well – strengthen your relationships.

“And I think the big thing is helping them to grow their business because a lot of people in the real estate industry, their businesses are down a lot. So I’m doing a lot of work with realtors focused on helping them to grow their business.”

The evolving role of the mortgage broker in Canada

For Weintraub, it’s essential that all involved in the mortgage process understand the evolution of the mortgage broker, with the profession having seen a profound shift in recent years as the market has changed.

Five years ago, a broker’s main value may have been in simply being able to provide their customer with the lowest possible rate. But when the COVID-19 pandemic struck and an unexpected housing market surge gathered pace, the role became all the more multilayered, requiring brokers to meet a range of client needs across an increasingly complex market.

“Two years ago, during COVID, there’s a huge bidding war,” Weintraub said. “So it was, ‘Give me the biggest mortgage possible – but I want a low rate.’ So it’s not just lowest rate. It’s lowest rate plus biggest mortgage possible, and a preapproval. So now you’re doing one plus two.”

With activity then seeing a marked downturn in 2022 as the Bank of Canada began to raise interest rates to combat rapidly rising inflation, Weintraub said a third evolution has since taken place: the onus being placed on brokers to liaise constantly with referral partners and find new ways to help them grow their business.

“Now what I’m focusing on and what I’m [telling] my brokers is: ‘OK, you’ve got a bunch of realtors. TRREB [Toronto Regional Real Estate Board] volume data is the lowest on record. So in the context that real estate is very, very slow right now and a lot of realtors are not making money, how can we help out realtors to make more money?”

Education the name of the game in 2024

Realtor seminars with first-time buyers and past clients are top of mind for Weintraub at present – and the growth of the alternative space, and difficulty faced by many Canadians in qualifying with traditional lenders, mean it’s also important for agents and brokers to keep an eye on the evolution of private lending.

“You have to understand private lending. You have to understand your lenders, what they’re good at, what they’re not good at – knowing your ideal customer and their profile,” he said.

Focusing on education and ensuring as comprehensive a knowledge as possible about the nuances of the profession, are also essential looking ahead to 2024, Weintraub said.

“In my opinion, mortgage brokering has become extremely technical and difficult,” he said. “The way I describe a mortgage broker is like an architect or surgeon or engineer – you just can’t take a one-week course and you’re ready to go. You can’t become an architect in a week. You can’t become an accountant in a week.

“So it really is an intense process and about looking at yourself as a professional – not just, ‘Yeah, I wrote an exam and I’m ready to go.’”

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