KPMG conducted a survey in Australia, Canada and the UK to gain better insight into the international mortgage market. The research sought to understand the attitudes and preferences of KPMG professionals regarding mortgages and to identify the impacts that COVID-19 is having on the mortgage market.
To succeed post pandemic, lenders need to understand the changing needs and expectations of the important mass affluent1 customer segment and reposition their product and service offerings accordingly if they are to win the fight for mortgage customers.
Digital is the preferred channel for all stages of the mortgage experience
Digital channels are the preferred choice for researching, servicing and applying for a mortgage. 90 percent of respondents want to research online, 76 percent want to service online and 58 percent want to apply for a mortgage online.
What to do with branches (and where to put them)
Thirty percent of respondents indicated they prefer to apply for a mortgage through the traditional branch channel. This is down 15 percent since the 2017 survey and highlights a trend in decreasing demand for in-person interactions with mortgage providers.
33% of respondents plan to renegotiate their mortgage (45% of Australian respondents)
To take advantage of falling interest rates since the onset of COVID-19 we are seeing a significant increase in the number of respondents planning to renegotiate their mortgage this year (up from 4 percent prior to the COVID-19 crisis).
Respondents rated issue resolution and empathy as the most important attributes of their desired customer experience when taking out a mortgage. Interestingly, these customer experience attributes are also where the biggest gaps between desired and actual customer experience exist.
10% of home owners have or anticipate the need for a loan deferral
With COVID-19 and uncertainty about economic stability and job security, 10 percent of respondents have requested or anticipate applying for a deferral on their mortgage repayments.
Continued demand exists for mortgages despite rapidly rising residential prices
Fifty-five percent of respondents who currently do not have a mortgage are planning to apply for a mortgage to purchase a home within the next 2 years. Of these, 45 percent expect to delay the purchase of their home, 44 percent do not plan to delay their purchase and 11 percent expect to accelerate buying a home.
1. Mass Affluent is defined as professionals earning between $60k and $500k (USD) per annum.