The mortgage broker industry in New Zealand has a major impact on the housing market, given that they write at least 40% of all the new mortgages every year. The individual mortgage broking companies operate in a wide continuum of high tech and low tech, and they use quite radically different business models in order to generate new business and to thrive.
At the low-tech end they’re mostly small and independent brokers who rely on the tried and true methods such as repeat business and high quality referrals from their networks of real estate agents, developers and banks and other lenders. These brokers have generally built up their networks over a long time, and although the work is hard they can do very well simply because they deliver excellent service.
At the Hi-Tech end of the market the mortgage brokers, who are generally working in a small handful of large businesses, are basing a large volume of their new business on what arrives over the Internet. In general most of the mortgage brokers in Wellington do not understand the sheer volume of new business that is generated over the Internet on a daily basis, and the reason they don’t understand is because they simply do not see this business. It is a golden rule of Google search that around 95% of all new Internet business will only go to the websites that appear on page 1 of any Google search, and the other 5% will be shared by the much larger number of mortgage brokers languishing on pages 2 and beyond.
The hi tech mortgage brokers Lower Hutt have made substantial investments in their web page and in their SEO to make absolutely certain that they are ranking in the top 3 for Google searches, because they know implicitly that this will cause them to win over 70% of all the new mortgage broking business on the Internet. These treasured top 3 spots cost a lot of money for the broking companies that arrived there, both in Web Development and in specialised SEO work. The risk for these companies is that SEO is a constant changing science, and unless they are investing regularly in the R and D necessary to make sure they are operating optimally, then they are very exposed to new entrants with new SEO technology and capabilities.
The real risk for these top ranking companies is that the actual investment required for a highly specialised SEO company can be orders of magnitude less than the investment that the top ranking companies have made, and if the highly specialised SEO company wants to really make a splash then they could make an even larger investment and largely wipeout the large mortgage broking companies.