Building a Top 100 investor broking powerhouse

Top 100 Broker Paul Wright has built a property investment-focused brokerage for the long term

Business is going well at Choice Home Loans Wollongong, and has been for some time. In fact CHL Wollongong has been one of Choice’s top performers for a decade, and principal Paul Wright regularly appears in MPA’s Top 100 Brokers report as well as at industry events where he talks about how he runs his business. All this has been built on a value proposition that has huge appeal for property investors.

At least 40% of CHL Wollongong’s business is investor-based, Wright explains. “It’s an area we definitely focus on regularly. We don’t say we just do investment, but it’s an area we try to get our clients to focus on, because we feel that’s the way they can get ahead long-term. Clients like the fact they’re not just coming for a home loan; they’re coming for advice.” 

While ‘advice’ is an occasionally overused term in the mortgage industry, Wright is actually a QPIA (Qualified Property Investment Adviser) and has a portfolio of properties himself. Beyond the usual work of a broker, Wright says he can advise brokers on ownership structures, tax depreciation and capital gains tax (with their accountant), as well as different types of property and cash flow. “I’ve got property investment software which can give clients an estimate, if they buy a property of this amount and receive this rental, of what it would cost them per week after tax benefit. It’s a value-add,” he says.

CHL Wollongong has always had an investment focus. “I’ve always been very interested in property investment, and I’ve wanted to have a point of difference from a lot of our competitors,” Wright says. Despite being such a popular strategy with clients, “there’s a lot of information [on property investing] which is quite confusing out there in the market”.

There’s no mandatory qualification for property investment advisers, and organisations like Property Investment Professionals of Australia have repeatedly warned of the risks of rogue operators. So, while the qualification is not a gateway to advice, Wright explains: “The biggest thing it does is give me credibility: I’ve got that qualification, but I also practise what I preach. My wife and I are fortunate to own multiple properties, so the clients’ experiences are my own experiences as well.” 

CHL Wollongong’s clients are mainly locals, and many choose to invest within Wollongong. Wright also works with buyers’ agents to advise clients on where to look further afield, rather than providing this advice himself. His clients are looking to build portfolios, and some own as many as 10 properties.

Investors make ideal long-term repeat clients, albeit clients with markedly different needs to owner-occupiers, Wright says. “They are rate-conscious, but not as rate-conscious.

We try and educate them to understand that the end goal is about creating wealth; saving 0.1% on an interest rate is irrelevant if you can’t get the finance to purchase that next investment.”

Outside investors, the brokerage continues to attract first home buyers, who make up around 20% of its clients, and Wright assigns these buyers to a younger broker who is of a similar age to the clients. Wright is, as he puts it, “trying to get the individuals to fit the client”.

CHL Wollongong has begun to ‘dip its toe in the water’ when it comes to diversification. Wright is training staff members on how to do car finance and commercial lending, although both of these services are referred out at present. Eventually they’d like to promote these services to potential clients, although Wright explains that diversification is “not a huge goal” for the brokerage going forward.

Instead the first thing on Wright’s agenda is growth. The brokerage has already outgrown its current shopfront and is looking for a larger location, possibly a converted house. Although walk-in clients are rare, Wright is keen for the brokerage to be visible and accessible from the street.

To fill their new home, Wright intends to hire three new brokers over the next few years, including training up some new-tobroking staff members. Ultimately, Wright wants these brokers to take pressure off him to be the primary broker. “I’m stepping back from doing the face-to-face appointments all the time, definitely. Not stopping it, but reducing it and allowing me to spend more time on training the staff and developing the business.”

For brokers looking to emulate CHL Wollongong’s long-term, sustainable success, Wright has a piece of advice: “If they’re in a position to, they should definitely buy an investment property themselves so they’ve got hands-on experience of having their own property and understanding how it works. The other thing I’d recommend is that they become a Qualified Property Investment Adviser like I have, and do a course to do that, which gives them some education. That gives them an added advantage over another mortgage broker.”

 

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