10 ALLIANCE MORTGAGE SOLUTIONS

Established 2012

Donald Tang and Eric Cui’s brokerage has survived foreign buyer restrictions by making some tough decisions

While many brokerages worry about their business being disrupted by new regulations, Alliance Mortgage Solutions has been through all of that and emerged in one piece. Alliance played heavily in the foreign buyer space, and the decision of most banks to stop lending in this space was a big blow to the brokerage, recalls sales director Donald Tang, who estimates that 35% of the brokerage’s business was affected. Staying in the Top 10 has required a major change in strategy and some tough decisions.

Foreign borrowers are not entirely without options. A couple of non-banks still lend to foreign buyers, says Tang, although “the interest rates are higher and their fees are expensive, so not many people want to choose them”.

Loans now require much more work to process, and so Alliance has begun charging clients fees of $2,000–$5,000. This is dependent on the difficulty of the scenario and whether the client has been preparing to buy for a long time; it’s new clients that are mainly charged fees. “Not many [are put off],” Tang explains. “They know the situation, they know the market is very hard; they want to find a professional broker who can get the deal done and keep the property.” Alliance doesn’t charge the most in this particular market, Tang adds.

Tang’s longer-term strategy is to shift Alliance’s focus towards local clients. “We are putting more energy and time into local markets, both residential and commercial lending as well.” Alliance has plenty of off-the-plan referral partners and is expanding its network of local real estate agents.

Ninety percent of Alliance’s business previously came from residential lending, but Tang wants to reduce this to 70%. Alliance has set up a business dedicated to commercial deals, for which it is hiring only experienced commercial lenders – a big shift from the new-to-industry brokers it previously targeted.

Despite all the upheaval of the last 12 months, it’s somewhat surprising to hear that Alliance is still hiring for both the residential and commercial businesses. The brokerage has balanced this with cost-cutting: it has dropped a number of support roles and will be leaving one of its offices on Sydney’s Castlereagh Street when the lease expires this year. Nevertheless, as Tang puts it, “I don’t think there are other costs we can cut”.

Hiring experienced brokers has another advantage in an industry plagued with uncertainty, Tang explains. “A lot of [our] brokers are worrying about the industry and their income. If I can get maybe two or three experienced brokers to join us, that’ll give them confidence.”