Aussie boss James Symond rejects house price gloom

Aussie chief executive James Symond is adamant the housing market and prices won’t plunge during the COVID-19 turmoil.

Aussie Home Loan's chief executive James Symond.

Aussie chief executive James Symond is adamant the housing market and prices won’t plunge during the COVID-19 turmoil, as he pushes ahead with new plans to expand the mortgage broking group.

Mr Symond said Aussie was faring well as it was seeing a “significant spike” in activity, largely around refinancing of loans and borrowing for renovations.

He noted Aussie, which was founded by his uncle John Symond in the early 1990s, was seeing more overall mortgage business in recent weeks than the same time last year “by a clear margin”.

And while he expected a softer housing market he was not anticipating a sharp downturn.

“Do I think real estate will plunge? No chance,” he quipped. “While interest rates are low the sector will remain sound. “I have no doubt the market will come off … but with interest rates so low it’s just as affordable to pay off a mortgage as to pay rent.”

Mr Symond said while lower migration and other factors would weigh on house prices in the near term, a low volume of stock on the market and a shortage of new housing would help prices hold up in the medium term.

The big banks are, however, cautious on credit growth and the outlook for house prices. Westpac has tipped prices will slump 15 per cent during the COVID-19 crisis, while ANZ anticipates prices will decline for three years.

Mr Symond on Tuesday outlined plans to recruit 200 new brokers to Aussie’s existing network of about 1000 this year, and add 89 retail stores by 2023. That will bring Aussie’s retail network to 300 stores.

“We have always thrived during times of uncertainty,” he said, noting Aussie was founded during the recession in the early 90s and expanded with the acquisition of Wizard’s loan book and distribution network during the fallout of the global financial crisis. “While most businesses are pulling in their horns, we are increasing ours.”

Mortgage brokers last year fended off a change to their commission pay structure, recommended by the Hayne royal commission.

Last week, the federal government delayed implementing Hayne’s remaining recommendations by six months so the finance sector could focus on minimising COVID-19’s fallout.

That included setting in stone a requirement that mortgage brokers act in customers’ best interests, a duty that now comes into force in January rather than July. Mr Symond said it was the “right call” by the government to delay the change, but Aussie was largely ready to meet the earlier timetable. Given the delay, the group is now reconsidering its implementation.

Commonwealth Bank has owned 100 per cent of Aussie since 2017, after buying a final tranche of the group. But as part of divestment program, CBA’s mortgage broking assets have been under strategic review for several years.

“The relationship we have with CBA is a strong one,” James Symond, John’s nephew, said. “It is up to CBA whether they want to retain or sell us, but Aussie has been its own entity.”