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How big is the biggest broker in the land?

The prospectus for Mike Pero Mortgages (MPM) provides some fascinating insights into both that business and the mortgage broking industry.

Wednesday, May 12th 2004, 7:45AM

by Jenny Ruth

MPM uses a New Zealand Mortgage Brokers Association (NZMBA) estimate that broker originated loans account for about 25% of total home loans. It estimates about $16.7 billion of loans will be written annually industry-wide, which puts the broker share at about $4.175 billion.

Then MPM says it expects to process $1.2 billion in mortgages this year through its 35 franchisees.

That means it is claiming to be involved in 7.2% of all home loans in New Zealand and to have a 28.7% share of the broker market.

That’s eyebrow-raising stuff when you consider that the NZMBA told its annual conference last September that membership was approaching 600 and that not all mortgage brokers belong to the industry association. Only a handful of the 30 Mortgage Choice franchisees belong, for example.

Nobody in the industry would dispute that the Mike Pero brand is by far the strongest in the industry and a country mile ahead of any other.

But you would have to wonder about the value of the brand when looking at the Colmar Brunton survey results included in the prospectus. From the survey, which was conducted in July 2003, which found that 16 times more people could name MPM as a mortgage broker than its nearest competitor.

Even on the prospectus figures, that doesn’t translate into 16 times the business.

One of the problems with the Colmar Brunton survey is the small sample size. Those questions with the largest number of respondents still only polled 500 people. The first of these two found that 35% could name MPM and another 20% could name other brokers. The rest of the sample couldn’t name any or didn’t know.

The other question with 500 respondents found 44% would consider using a mortgage broker, 41% wouldn’t and the rest didn’t know.

Of the 221 people who were asked which mortgage broker they would choose, 45% said MPM and 35% said don’t know. Next was Approved Home Loans at 7%, Mortgage Choice at 3%, Property Pack at 2% and Mortgage Link at 2%.

It has to be highly unlikely that Mortgage Link’s share of the market is only 2% or that Mortgage Choice’s is only 3%.

« House price rise expectations dwindleMortgage Alliance to be dissolved »

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Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
ANZ 5.19 3.95 4.15 4.49
ANZ Special - 3.45 3.65 3.99
ASB Bank 5.20 3.89 4.05 4.39
ASB Bank Special - 3.39 3.55 3.89
Bluestone 4.44 4.44 4.29 4.34
BNZ - Classic - 3.49 3.55 3.89
BNZ - Mortgage One 5.90 - - -
BNZ - Rapid Repay 5.35 - - -
BNZ - Std, FlyBuys 5.30 4.45 4.35 4.55
BNZ - TotalMoney 5.30 - - -
China Construction Bank 5.50 4.70 4.80 4.95
Lender Flt 1yr 2yr 3yr
China Construction Bank Special - 3.19 3.19 3.19
Credit Union Auckland 5.95 - - -
Credit Union Baywide 5.65 4.75 4.75 -
Credit Union North 6.45 - - -
Credit Union South 5.65 4.75 4.75 -
Finance Direct - - - -
First Credit Union 5.85 3.99 4.49 -
Heartland 6.70 7.00 7.25 7.85
Heartland Bank - Online - - - -
Heretaunga Building Society 5.75 4.65 4.80 -
HSBC Premier 5.24 3.54 3.20 3.69
Lender Flt 1yr 2yr 3yr
HSBC Premier LVR > 80% - - - -
HSBC Special - - - -
ICBC 5.15 3.18 3.18 3.20
Kainga Ora 5.18 3.97 4.05 4.39
Kiwibank 5.15 4.20 4.30 4.64
Kiwibank - Capped - - - -
Kiwibank - Offset 5.15 - - -
Kiwibank Special - 3.45 3.55 3.89
Liberty 5.69 - - -
Napier Building Society - - - -
Nelson Building Society 5.70 4.25 4.15 -
Lender Flt 1yr 2yr 3yr
Pepper Money Near Prime 5.64 - 5.44 5.44
Pepper Money Prime 5.18 - 4.98 4.98
Pepper Money Specialist 7.59 - 7.39 7.39
Resimac 4.50 4.45 3.89 3.94
RESIMAC Special - - - -
SBS Bank 5.29 4.85 5.05 5.49
SBS Bank Special - 3.39 3.55 3.89
Sovereign 5.30 3.89 4.05 4.39
Sovereign Special - 3.39 3.55 3.89
The Co-operative Bank - Owner Occ 5.15 3.49 3.59 3.89
The Co-operative Bank - Standard 5.15 3.99 4.09 4.39
Lender Flt 1yr 2yr 3yr
TSB Bank 6.09 4.19 4.35 4.69
TSB Special 5.29 3.39 3.55 3.89
Wairarapa Building Society 5.50 3.95 4.05 -
Westpac 5.34 4.15 4.09 4.49
Westpac - Offset 5.34 - - -
Westpac Special - 3.39 3.55 3.99
Median 5.34 3.96 4.09 4.39

Last updated: 21 February 2020 4:32pm

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