It may be a case of thinking the grass is greener on the other side, but a growing number of B.C. brokers are moving to get licensed across the border in Alberta, as originations in their own large markets slow.
“I’m hoping to get licensed in Alberta this month, during the licensing period there,” Scott Dawson, a broker with Verico Paragon Pacific Mortgages in Burnaby, told MortgageBrokerNews.ca. “I’m busy this year and have exceeded last year’s funded volume, but there are sections of the market here that have slowed. Given the average home price and the economy, in terms of the potential for originations, Alberta is very attractive.”
He’s not the only Vancouver mortgage professional casting eyes over the border at the only housing market in the West to virtually maintain 2010 levels of affordability. While MLS sales in Calgary rose some 22.1 per cent in August, compared to the year-ago period, selling prices eked out only a 2.2 per cent gain.
It’s a remarkably different picture from B.C.'s Lower Mainland, where the average home price -- while skewed by high-end sales in Richmond, West Vancouver and the West Side – rose 14 per cent last month, compared to the August 2010 average of $680,782.
That phenomenal growth has worried Realtors and brokers, concerned about clientsbeing increasingly priced out of the market. The result for many mortgage brokers in Vancouver has been slower originations this spring and summer. Those looking to explore opportunities in Alberta are hoping a buoyant economy and growing consumer confidence will combine with lower home prices to spur home sales in both Calgary and Edmonton. They’re also hoping to claim a bit of that action for themselves as a hedge against any further contraction in their home markets.
Vancouver brokers are also attracted eastward by a new internal trade agreement making it easier for brokers to gain licenses in other regulated provinces. A dual license would allow Dawson to market himself in Alberta and close deals there, the mortgage professional, like most eyeing Alberta, using the Internet to generate leads.
Still, brokers in Alberta are offering their eager counterparts in B.C. a word to wise about the market where the average home price is less than half that of Vancouver’s. It means commissions on originations – even if Vancouver brokers succeed at winning them – will be similarly modest.
“Obviously, two deals (in Calgary or Edmonton) at $250,000 are better than no deals at $1 million in Vancouver,” Daniel Alves, an associate broker at Link Lending in Edmonton, told MortgageBrokerNews.ca. “But there are two things that they need to consider. One: how many deals are they realistically going to be able to close without being on the ground in our market? And, two: closed mortgage business follows the effort made by a broker to win that business, and obviously there are mortgages closing in BC – maybe they should look more closely at what they are or are not doing to win the business happening in their own market.”