REA Group is struggling to make headway in financial services, a business it has targeted for growth since it acquired broker franchise group Mortgage Choice in 2021. The property services company released its December 2023 half results yesterday, reporting that its financial services division had lower settlements and earnings. Divisional revenue for the six months to December was A$36.1 million – an increase of 4 per cent over the previous corresponding period. EBITDA fell from $8.7 million to $7.5 million over the period. Loan settlements of $11.1 billion were down 4 per cent year-on-year. This compares with ABS data showing an 11.7 per cent increase in the value of total new housing loan commitments over the 12 months to December. The loan book was up 1 per cent year-on-year to $88.5 billion. This compares with system growth of 4.1 per cent in mortgage balances over the period. Broker numbers were up 2 per cent to 1061. On the positive side, the company said it increased the penetration of its white label loan, Freedom, which is funded by Athena Home Loans and generates a higher margin. Freedom loans represented 6 per cent of submissions and accounted for the increase in revenue. The partnership with Athena was formed in October 2022. The Freedom loans have a focus on rewarding existing customers, using a pricing structure that lowers the rate as the size of the loan reduces. REA’s $244 million acquisition of Mortgage Choice was completed in June 2021. In the six months to December of that year, the group’s financial services revenue was $41.3 million and EBITDA was $13.6 million. In that half the division contributed 3.7 per cent to total group EBITDA. In the latest half the contribution was 1.8 per cent.