The COVID-19 pandemic has changed the way we live, work and play, so seismic shifts in our economy and housing market are par for the course. Encouragingly, Australia’s love affair with real estate shows no signs of cooling. Homebuyers and property investors remain eager to take advantage of new growth corridors, new trends and record low rates, which presents a compelling case for brokers.
At NAB we have an optimistic view of Australia’s economic recovery. The Australian housing market faired significantly better than expected over the past year, despite significant headwinds, including slower population growth and a weaker labour market. Lower interest rates and household income support from the Federal Government have provided key buffers.
How the pandemic has changed the house hunt
Recently released NAB data has detailed the factors that have become more important to Australian homebuyers since the pandemic.
The research, which surveyed 330 property professionals (including investors, real estate agents, & developers), revealed the top change is the need for a work/study area, while greater value is also placed on having good local amenities and the size of a property. In contrast, interest in apartments and the desire to be close to the CBD has weakened.
This change in preferences has largely been driven by flexible working arrangements with commute times becoming less of a factor. With the outer suburbs and regional towns being generally more affordable than the inner-city, it’s not surprising that growth in regional areas is outpacing capital cities.
NAB’s research also revealed around nine in 10 (86%) homebuyers see a study/work area as more important now than it was pre-pandemic. Other factors to hold greater value include good local shopping, restaurants and amenities (75%), the size of the property (65%), buying a house over an apartment (63%) and access to good public transport (51%).
Regional vs metro trends
The factor that has shown the greatest decline in importance is the need to be in a metro area, with 57 per cent saying this is now less important. Victorians are seen most willing to move away from metro areas on the back of Melbourne’s longer lockdown.
In a similar vein, consideration of a move to regional areas is swelling, with 85 per cent listing this as a more important factor. Buyers in NSW, home to Australia’s most expensive capital, are seen to be keenest to consider a regional move. This shows up in price data as regional NSW outpaces all other regions.
The idea of a sea change or tree change is exciting to many Australians and a large number of customers have made the move in recent months as hybrid working models become more common.
Our data shows more than one in 10 Australians expect to buy a home this year*, and more and more will be looking further out of CBDs than we have seen historically.
Digital shifts and enhancements
In the same way digital tools have increased the ability of Australians to work remotely, and flowed through to housing preferences, digital tools have also changed the way brokers engage with their customers.
Throughout NAB’s digital mortgage journey – which started in September 2019 – our long-standing objectives have been delivering more efficient turnaround times, reduced rework and simplification.
Our eSign capability, powered by DocuSign, has proven to be critical amid the ongoing COVID-19 pandemic. We’re seeing that the majority of NAB customers are now opting in to digitally sign their home loan documentation, which is a trend we expect customers and brokers will continue to adopt long after social distancing measures have eased due to its convenience.
The latest updates to ApplyOnline are designed to help our brokers get home loan applications right the first time by providing clearer guidance on submissions requirements and ensuring our policies are clear and easy to understand.
Some of these recent changes include the introduction of Missing Information Requests, so that brokers are instantly aware that more information or documents are required to progress an application. LMI quotes can now be completed inside of ApplyOnline, without having to use an external calculator, making the whole process faster and efficient. We’re also simplifying and enhancing the way non-credit critical variations are submitted for simple loan changes that do not require credit assessment with a new digital Request to Change (RTC) form completed online.
Our next priority over the coming months is around the simplification of our Loan Documentation, condensing these down to just a few pages and providing a streamlined customer experience.
Critical role of brokers supporting customers and our economy
While buyer behaviour and shifts towards digital tools are changing rapidly, one thing remains constant, and that is the essential role brokers play, by helping Australians navigate some of the most important financial milestones of their lives. This guidance is even more critical in a fast-moving property market, where housing prices are growing rapidly and customers need to feel greater confidence, whether purchasing a new home, refinancing or growing their investment portfolio.
NAB continues to have competitive offers in market – including our $2,000 Refinance Cash Bonus and our lowest 3-year fixed rate home loan ever (refer to your BDM or the NAB Broker portal for more information).
As the bank behind brokers, we remain committed to backing the growth of broker businesses by providing the insights and tools you need to deliver great outcomes to your customers.
* Recent NAB research shows 45% of Australians believe now is a good time to buy a home, with 13% planning to buy a home in the next 12 months.