As Canada’s spring market ramps up, Canadian Mortgage Professional sat down with Pineapple CEO Shubha Dasgupta to hear his thoughts on market activity this year and the role technology is likely to play in the industry in the coming years, as well as checking in on the latest updates at CMBA-Ontario.
Fergal: [00:00:13] Hello again and thanks for joining us for another edition of CMP TV. I'm Fergal McAlinden, news editor at Canadian Mortgage Professional. And today, we'll be continuing our look at some of the major trends that have been emerging in Canada's mortgage market so far in 2022 and what could be coming down the line for the remainder of the year. My guest today is chief executive officer and co-founder of Pineapple, a nationwide network that currently numbers more than 400 brokers. A member of the mortgage industry since 2008, he's grown that network through a combination of cutting edge technology and a people centered approach. I'm speaking, of course, about Shubha Dasgupta, who I'm very pleased to welcome to the show today. Shubha, thanks for joining us. How are things with you?
Shubha: [00:00:52] Everything's fantastic, Fergal. Thanks so much for having us on.
Fergal: [00:00:56] Thanks very much for joining us. I want to start off just by talking about the market a little bit so far this year. How would you describe activity to date? Have you seen any kind of cooling off or are things still at the same level as last year?
Shubha: [00:01:09] Yeah, I mean, in terms of what the years look like, since since the beginning, since January, we've seen a little bit of well, a lot of activity in January and February, but it was hindered by a lack of supply. There was a tremendous demand in the market, and a lot of buyers were getting frustrated with the lack of inventory and opportunity that they had available to them. Since the beginning of March, we've begun to see more inventory come onto the market, as well as some of the buyers kind of fall off through frustration as well as the interest rate increases. So the demand is beginning to balance out a little bit with supply, but still certainly under a lot of pressure given that there's been a slight cool off since that interest rate increase. However, we haven't seen much of that impacting prices. We've seen multiple offer situations cool off slightly and more options becoming available for potential home buyers.
Fergal: [00:02:03] Shubha are there any significant trends that you're expecting to emerge further down the line this year, even in relation to those interest rate increases?
Shubha: [00:02:12] Yes. Some of the things that we're already beginning to see as of late last year and certainly continuing into this year. And I can expect to see throughout gifted down payments becoming a larger and larger part of the home buying process. Right now for first time home buyers, we're seeing approximately 30% of all first time home buyers with a portion of their down payment coming from a parental gift or support from a family member. The average gift site gift size sorry for this first time home buyer is roughly around $80,000. But it's not just first time home buyers that are experiencing this. We're also seeing the move up buyers getting support from family to be able to get into that next home or that move up larger property that they've been looking for. So gift it down payments is certainly something that I expect is going to be a driving trend. I think affordable housing or affordable properties, whether it be condos, whether it be relocating to different geographic areas, is going to be a continuous driver as we go forward. We're already seeing a surge into the condo market, predominantly driven by the lower price points that are available as opposed to single family homes and such. And we're seeing more and more people beginning to move into further locations or different geographic locations that might offer a price point that's more suitable to them. Another thing and kind of the final thing I'll touch on from a trend perspective of what we might see this year is a continuation of what the industry has kind of coined as real estate hoarding. We're seeing more and more Canadians holding on to real estate and more and more multi home family owners. So more and more Canadians that are getting into investment properties, those that when they are moving up or moving down, they're deciding to keep their existing property as opposed to put it back onto the market. And that's certainly influenced the supply crisis that we currently have here today.
Fergal: [00:04:06] We've often talked about the role that technology is going to play in the future of the industry. And I know that it's something that's really central for Pineapple. What are you keeping top of mind, Shubha, in your approach to technology in 2022 and further down the line?
Shubha: [00:04:19] There's something that you'll often hear me say, Fergal, is that, yes, we're a technology company, but we're a people company first. And when we look at technology, we have to always remember that technology empowers people in our industry. The incredible mortgage brokers and mortgage agents are the ones that are delivering services to Canadian homeowners and home buyers all across this country. And the goal of technology is to empower them to be more effective and more efficient at their jobs, ensure that they have a built an ability to use technology to create more deep and meaningful relationships with these Canadian homebuyers and mortgage seekers and ensure that we can help streamline the process for all involved. So some of the things that we're looking at are things like automation consistently being able to remove people power throughout the process of that mortgage loan to allow the mortgage agent to deliver that time back into their business, as well as ways that we can streamline and elevate the experience that their customers are getting.
Fergal: [00:05:19] And it feels like it's flown by. But the coming months are actually going to mark one year since the rebranding from CLC network to Pineapple. How has that journey been since then, and are you excited to share anything about the company this year?
Shubha: [00:05:33] You know, Fergal, it's, it's yeah. We often forget that it was just less than a year ago that we converted from what we were to, to Pineapple. Today, I think we've all embraced Pineapple and we've fully become it over these last few months. But the journey has been phenomenal. You know, we've gotten such a warm reception from our internal agents, our brokers, as well as our staff members. But we've also been able to really create a brand that's meaningful to our audiences, both within the mortgage community as well as throughout the throughout Canada. For those seeking mortgages, you know, I think Pineapple speaks very much to who we are as people. It's fun, it's whimsical, it's warm and it's hospitable. And we've really been able to elevate this brand and make it our own. And over the last few months, I think we have become Pineapple more than Pineapple has become us. So very happy in how the last year has gone. Some things and some excitement that are coming this year. You know Fergal Maybe we're going to have to wait and see, but there's always something exciting brewing here at Pineapple and you can certainly expect to see some very good news from both how we're going to deliver technology, innovation and change into the landscape, but also how we're going to continue to support and elevate this industry and make sure that mortgage brokers are the predominant source of mortgages for all Canadians.
Fergal: [00:06:57] I also want to ask you a little bit about your work with Canadian Mortgage Brokers Association, because in addition to Pineapple, you're a licensed director and president of CNBA. How are things going at the association in 2022? And is there anything you're encouraging brokers to keep top of mind?
Shubha: [00:07:14] You know, 2022 is setting out to be an incredible year for the association as the world is beginning to open back up. We're seeing the opportunity for us to reconnect with our base. We have our first in-person gala already scheduled for April. April six and seventh is going to be the gala conference and trade show. And we've already sold out and expect to see an incredible amount of mortgage professionals attending, networking together and be able to share that in-person interaction that we've all been longing for. This is going to be the first of many in-person events, hopefully this year, as we have so many scheduled to come down the pipe in terms of summer fest, various golf tournaments, the casino night is going to be coming back, which was a great success last year and so many other educational opportunities. The focus for this year is really continuing to unite the industry through these events and make sure that we're all working and striving towards one common goal as well as educating, making sure that we're continuing to deliver a high level of education and continuing to elevate this industry.
Fergal: [00:08:25] So then my last question for you is one that I'm always interested in speaking with members of the mortgage industry about, and that's if there's anything that you'd like to see implemented at either a provincial or federal level that you think would really benefit the industry or the market as a whole.
Shubha: [00:08:42] We're seeing a lot of things changing in the market right now, and we're seeing a lot of policy that's being introduced. You know, the federal government has introduced certain affordable housing strategies. They're helping municipalities cut red tape. They're helping build more affordable and high density homes throughout the country. And I think one of the things that we really need to focus on as an industry, as a government and as a nation, is making sure we have homes for all of the people that want to call this great country their home. You know, we continue to see growth, 1.3 million immigrants expected into Canada over the next three years, many of which are going to become homeowners in a very short period of time. We're seeing the younger millennial cohort coming of age and creating housing formations. We're starting to see the older Gen-Z cohort coming of age and becoming housing formations. And we want to make sure that all of these people have an opportunity to have a place that they call home. So I would love to see the government work alongside municipalities, work alongside our industry, and find ways and creative solutions on how we can ensure we're adding supply and inventory into the meet the demand of this beautiful country.
Fergal: [00:09:59] Okay. Excellent. Well, look, that's all that we have time for today. Shubha that we really appreciate you coming on to share your insights today. Best of luck in the future and I'm sure we'll speak to you very soon.
Shubha: [00:10:08] Thank you so much, Fergal. Always a pleasure.
Fergal: [00:10:11] We leave it there for today. Thanks to you for watching and we'll see you next time here on CMP TV.