Broking opens up a world of long-term rewards and gratification
Loan Market Vantage broker Bechara Boutros (pictured) wants to see more fresh faces on the mortgage broking scene.
Adelaide-based Boutros worries that the profession that he loves often gets overlooked by the ostensibly sexier real estate world, where glitzy social media posts present an image of the enviable estate agent baller.
But why, given the two professions are intrinsically linked, do hungry dealmakers so often gravitate towards real estate over finance broking? Why is the former considered the “sexier” of the two career paths?
“It’s because it’s postable and it’s sociable,” Boutros said in conversation with MPA. “There are these shiny houses which a lot of these younger agents can't in their early years probably even afford to finance.
“They’re selling or holding openings for properties that are well above that they can afford. It’s a life they don’t quite have, so you’re living vicariously through somebody else.”
He suggested the high degree of autonomy in the real estate space and “a degree of free rein about the type of person you wish to be” is enticing.
Broking, on the other hand, is substantially more data-driven. Think hours of crafting numbers-heavy Excel spreadsheets.
“For lack of a better term, it's a bit boring,” said Boutros. For the most part, Boutros’ job consists of spending most of the day in an office, whether it's with the team, professionals, or clients.
“It's just not as sexy,” he said. “Do you want to sit in an office all day for 10 hours punching out calculators and lender policies? Or do you want to get in the car and drive around and go look at million-dollar houses?”
To be honest, Boutros made a pretty strong case for getting into real estate over broking – more or less the opposite of what he’s out to do.
But behind the countless spreadsheets and loan calculators, Boutros believes broking can be an incredibly rewarding career path.
The same could obviously be said of real estate, but Boutros is passionate about the long-term bonds he forges with his clients. It’s the difference between adding value to your client, or just closing a deal and moving on.
In his words: “Do you want a transactional operation or do you want to build something with repeat business and trail income where you're known as the guy to go to?”
As an experienced broker, “you’re delivering things that are not researchable,” said Boutros. “Your client can't go on Google or speak to ChatGPT and find out what a lender's construction policy is between a percentage of 50 to 60 LVR for someone who's self-employed and has less than two years trading history.”
The broker-as-trusted-adviser trope is well recognised these days, and with an ever-increasing share of the residential and commercial markets, it will only become more so.
Financial rewards
It is true, real estate agents see a higher financial reward for selling a million-dollar home than brokers do for a similar financing arrangement.
"That's what the younger generation sees and it grabs their attention,” said Boutros. But that only tells part of the story. “They don't see the experienced business owners who have built up great businesses and trail books that reflect their commitments to customers."
The best brokers – the ones who look far beyond the transaction – will keep clients for years, meaning they are the first port of call for future financing needs, be that refinancing, commercial property or equipment finance. This has never been truer in the age of diversification.
Sure, brokers are less privy to the sexiness of traipsing around fancy properties out of their reach, but the clever ones can build a substantially profitable trail book that can generate income well beyond the point of sale – sometimes even generationally.
“The most exciting thing about money, unfortunately or fortunately, depending on how you look at it, is spending money,” said Boutros.
Living for the weekend
Here’s a question posed by Boutros: How important is your weekend? For him, building a career that worked around his lifestyle was one of the main motivating factors for leaving the banking world and entering broking.
There is no doubt that mortgage broking is extremely hard graft from the outset. It is a skill after all; to master any skill requires hundreds of hours of practice.
But building a lucrative trail book that provides a stable income is not something you get from being an estate agent.
“If you work as an agent… you need to keep feeding the machine. You don't get any sort of ongoing management fees, trail or income. You list, you sell, you get paid and that's the process,” Boutros said.
“Without scalability through a team, without the acquisition of a rent roll or building your own rental agency, you continuously have to sell and find new stock in order to service your revenue line.”
After 16 years in the business, Boutros knows more than most how much long-term gratification can come from mortgage broking.
“When you work really hard on something and it comes off and at the end of that is a client who's now bought a house they've been desperately trying to, or a family that you've helped financially improve their position, there is gratification in the notion that I did something good.”
Promoting broking
Boutros would like to see the government to encourage more brokers into the industry through subsidised apprenticeships.
"If a business owner has made the effort to train up his team and has a sustainable business with 16 or so staff, the opportunity to bring another six or so apprentices into the business under a dedicated training program makes sense for everyone," he said.
"The apprentice gets the necessary training and exposure to a successful brokerage; the business owner scales their business; the government gets more young people into the workforce through trained positions.”
Subsided apprenticeships would help business owners scale their brokerages, too.
"Brokers account for 75% of all home loans written, so we're the clear preference for customers starting out on their property hunt," he said. "But we seem to lose a lot of potential talent to the real estate profession. Real estate and mortgage broking are intertwined and require a similar skills set: lead generation, building trust with strangers, compliance and more.”
Does he worry about the prospect of market saturation? There are, after all, more than 22,000 brokers on the scene at latest count.
“I’m an active broker, so I still write business, but I don't have a concern with other brokers coming into the industry," he said.
He believes more brokers coming into the market is a win-win. Quality brokers who achieve outstanding results elevate the industry as a whole through friendly competition.
On the contrary, “if a broker doesn't deliver an exceptional experience to the client, that raises my business up because it highlights the difference between what we deliver as good brokers, and what the not so good brokers deliver.”
