A new survey of mortgage brokers provides an insight on their views of the Reserve Bank, with 40% saying the RBA might not have done a good job during the pandemic.
Digital loan and broker platform Hashching carried out the survey of brokers in August. It also showed that 87% of those surveyed had expected the RBA to lift interest rates on August 2.
With four consecutive rate rises and the official cash rate now sitting at 1.85%, the brakes are being applied to the NSW and Victoria housing markets, with 65% of brokers predicting an OCR of 2.6% by February 2023.
Hashching connects customers with verified broker partners and uses unique proprietary software and CRM lead management information.
“This might be the first time we’ve seen a survey result where not one respondent expects rates to go lower,” said Hashching CEO Arun Maharaj (pictured). “It’s not all doom and gloom for borrowers though.”
Maharaj said that now the official cash rate was at 1.85%, it appeared that most brokers expected the RBA to pull back on rapid rate rises soon.
“Given the RBA’s predictions on the official cash rate and the discounted mortgage rate, there’s a solid dissenting opinion now growing in the ranks,” he said. “A total of 26% of brokers we surveyed believe they will be dealing with discounted mortgage rates above 4% by the end of this calendar year. Sentiment is clearly changing quite rapidly.”
The Hashching broker survey also questioned brokers on what they thought of the RBA’s performance navigating Australia through the pandemic and the performance of the big four banks with their lending expectations.
“It is good news for the commercial banks as 78% of respondents agreed they were cautious and stress tested applications prudently,” he said.
However, only 8% of brokers felt their tests were being manipulated by applicants.
Read more: ANZ, Westpac lift interest rates
Maharaj said the August survey focused on the performance of Australia’s major financial institutions in recent months.
“What’s interesting is that there’s a big difference between how the mortgage broker community views the performance of the big four banks and the RBA during the pandemic,” he said. “The big banks are viewed as acting quite prudently, whilst the RBA itself appears to be taking the blame for lowering the cash rate to all-time lows. It might be a rough review for the RBA if it cannot show the market that it has a good handle on the situation in the coming months.”
