Brokers on the money with rate cut: survey

Created on Wednesday, 02 November 2011 17:33

A majority of brokers anticipated the RBA’s cash rate cut in November, with 73.1 per cent of respondents tipping the November decrease in The Adviser's Q3 2011 Sentiment Survey.

This was a massive 68.4 per cent jump from the number that flagged a rate cut in Q2 2011 and a 69.7 per cent rise on the Q3 2010 figure.

Meanwhile 63.9 per cent of brokers believe the Reserve Bank has been doing a good job controlling inflation through its rate management.

This represents a rise of 5.6 per cent from last quarter and a 1.3 per cent rise from Q3 2010.

The sentiment survey also revealed that more brokers expect their loan volumes to rise in the coming quarter, with 43.8 per cent expecting an increase – up 8.9 per cent on Q2 – and only 19.2 per cent anticipating a decrease, down 9.6 per cent on the last quarter.

Brokers still remain split, however, on whether current commission levels are sustainable: 48.9 per cent believe they are, while 45.7 per cent are doubtful.  The remainder were unsure.

A majority of brokers – 54.8 per cent – think refinancers will form the most active buyer sector over the coming quarter.

Meanwhile, the removal of stamp duty concessions in NSW could be the reason why 13.7 per cent expect the first home buyer sector to pick up speed this quarter, a rise of 6.5 per cent since Q2.

While a majority 73.3 per cent of brokers claim to have recommended non-bank products to clients in the past quarter, this still represents an 8.5 per cent drop from the Q3 2010 figure.

Confidence in the Gillard government’s ability to handle economic affairs seems to have declined slightly, with 79.9 per cent of brokers dissatisfied with the government’s performance – 1.5 per cent more than in the last quarter.  

The proportion of brokers that is happy with the government’s performance, however, has remained steady, with just 16.9 per cent saying they believe the government is doing a good job.

Only 12.8 per cent of brokers consider current economic conditions to be better than those in the previous quarter. Nevertheless, this is still a rise on last quarter’s figure of 10.4 per cent, the proportion that thought Q2 2011 conditions were better than those in Q1.