The same model for mortgage broking was launched across Australia a year ago and some states also offer insurance and conveyancing.
While conveyancing won’t be available on this side of the Tasman, LJ Hooker New Zealand financial services general manager Steven Dyhrberg hopes that from an initial mortgage broking basis, insurance and even referrals for utilities will be part of the customer package in the long term.
The real estate firm presently has formal “preferred broker” arrangements with independent mortgage brokers across the country, but has invited expressions of interest for franchises.
The target is six franchises by the end of March and nine by October 2006. “The financial services network would then grow with the real estate franchise network,” Dyhrberg says.
More than 60% of LJ Hooker’s office are north of Waikato, so many of the franchises will be in that location too. Each franchisee will be assigned a number of LJ Hooker real estate offices in a geographical area.
The first franchisee, Bruce Condliffe of Christchurch, will be based in LJ Hooker’s Christchurch operations centre in Riccarton and cover the greater Canterbury area.
Expressions of interest had come from established mortgage brokers and new entrants to the industry, Dyhrberg says. All franchisees must be NZMBA members and hold appropriate qualifications and a robust code of conduct has been established, he says.
Customers will be referred by LJ Hooker salespeople and Dyhrberg hopes they won’t be the historical last-minute non-conforming or low quality clients who agents are struggling to secure a sale with as finance is difficult. Instead, he’s aiming for a staff referral points reward system to give the incentive for clients to be introduced by salespeople at the appraisal and open home stage of the house buying process.
Dyhrberg believes the biggest challenge for the company is to overcome the existing relationships salespeople have with mobile mortgage managers from large financial institutions and the incentives they can offer and encourage staff to recommend people to the financial services franchise.
As part of the franchise deal, the brokers must use aggregator Plan New Zealand. LJ Hooker also has its own branded mortgage product.
