No sign of risk in hot home lending, says Lendi Group’s David Hyman

Pockets of risk are not yet creeping into home lending despite the buoyant housing market, says Lendi Group CEO David Hyman.

Lendi Group chief executive David Hyman. Picture: Jane Dempster

Pockets of risk are not yet creeping into home lending despite the buoyant housing market, with only “slight” increases in average loan sizes and no sign of speculative investor activity like that seen in 2016 and 2017, according to the CEO of the newly merged Aussie Home Loans and online brokerage Lendi.

Speaking to The Australian in an exclusive interview ahead of the completion of the merger on Tuesday, the CEO of the new Lendi Group, David Hyman, said both brokers had experienced record months in the recent boom.

“It’s undeniable that the market is really hot at the moment,” Mr Hyman said. “Given where interest rates are, we’re seeing a lot of refinance activity.

“On the purchase side, it is pretty crazy out there. Low interest rates are driving an environment for consumers where housing affordability is significantly improved, and that’s driving a lot of house pricing transactions.”

Mr Hyman co-founded Lendi in 2013 and was its CEO before the merger with Aussie. While there was talk of a potential IPO for Lendi before the merger, that is now, understandably, on the backburner. But Mr Hyman is still keeping his options open.

“We got very, very close, on the Lendi side, to an IPO last year, and obviously made the decision to go down this path, which we think was very much the right path to take,” he said. “For now, we’re very much focused on bringing the two businesses together. But you never rule these things out.”

The new Lendi Group will operate a multi-brand strategy, maintaining and investing in the Aussie and Lendi brands while bringing together their capabilities to accelerate growth.

“The differences between the Lendi and Aussie models are what makes our two businesses so complementary and with that comes huge opportunities for our brands, people, brokers, franchisees and business partners,” Mr Hyman said.

“At the heart of it, Lendi and Aussie have always been driven to change the home loan industry for the better. Together, we will bring a greater choice of lenders, products, efficiencies and ways to engage in the home loan process to borrowers and brokers.”

The completion of the merger comes days after Aussie Home Loans chief executive James Symond stepped down after six years in the top job.

Mr Symond’s unexpected departure marked the end of a 30-year career at Aussie, much of it spent working alongside his uncle and Aussie founder, John Symond.

Announcing the merger late last year, Aussie owner CBA said the terms of the deal would result in Lendi investors holding 55 per cent in the joint business, while CBA would hold 45 per cent.

With the merger now complete, creating Australia’s largest retail mortgage broker with a loan book worth more than $70bn, Mr Hyman said his focus would be on bringing the two businesses together.

With the property market tipped for double digit gains this year, Mr Hyman is not seeing excessive levels of risk and says clarity around lending obligations has made it easier for customers to get loans.

“We had that period post the royal commission, where there was a lot of uncertainty on the lender side around where regulation was heading,” he said.

“Post the wagyu and shiraz case, plus signalling from the government about responsible lending obligations through the COVID period, there’s a lot more certainty and clarity (for the banks) around what credit profiles look like. That’s making it easier for customers to get the right outcome the first time around.”

Originally published as No sign of risk in hot home lending, says Lendi Group’s David Hyman