Far from the expected drop off in agents as the market slows, British Columbia appears to have experienced a marginal growth in the number of mortgage professionals.
The province actually gained at least 32 new mortgage brokers and sub mortgage brokers this year, according to data from the registration office of the Financial Institution Commission of B.C.
As of August this year, the commission had 803 registered mortgage brokers and 3,245 sub mortgage brokers compared to only 795 brokers and 3,225 sub mortgage brokers for the same period last year. The commission, however, said it cannot determine if all the registrants are active or not.
Earlier this year, some industry observers estimated that the attrition rate for the channel in the Vancouver area could be as high as 7 per cent to 9 per cent of the more than 100 mortgage professionals who entered the profession after 2008 when the market rebounded from the previous recession.
Many brokers reported seeing a surge in the number of new entrants seeking part-time employment outside of brokering as a survival strategy to in reaction to the recent market slowdown. They said new agents are particularly vulnerable to the market fluctuation because they typically have not yet developed deep client portfolios and are prone to draw business from refis, second mortgages and other secondary transactions.
“We’re talking about young agents who haven’t had the time to develop a client book of people with significant equity in their homes and so are dependent on those first-time buyers with 5 per cent down,” Ray McMillan, a broker with Home Mortgage Consultants Inc. in Mississauga, told MortgageBrokerNews.ca. “Also, in terms of refis, unless you have a stable of private lender in place, it will be harder to get those refi deals done."
The B.C. market might even be getting some brokers from Ontario, according to records from the Financial Services Commission of Ontario.
Currently, there are 53 brokers and agents licensed in Ontario who have obtained licenses to practice in both B.C. and Alberta, according to Rowena McDougall, senior manager of public affairs for FSCO.
Of the 29 agents, she said, three are licensed in B.C., 22 in Alberta and four have sought licenses in both provinces.
Of the 24 brokers, three are licensed in B.C., 20 in Alberta and one in both B.C. and Alberta.