Will The Refinance Boom Continue in 2022?
Ralph Abbott
I Help Real Estate Investors and Business Owners Attain Financing When Your Existing Bank Says No
Will The Refinance Boom Continue in?2022?
The real estate market has experienced a huge surge in residential mortgage refinances due to historically low interest rates.
But we’ve already seen a slight uptick in rates.
The Federal Reserve has already predicted “gradual” rate hikes in 2022.
What does this mean for realtors and mortgage professionals that are focusing their business on the refinance market?
We all understand these record low interest rates drive the refi push, but what happens when interest rates rise and the refinance market dries up?
For many, it will be too late, they will be left waiting on the Fed to lower rates again to bring clients back to refi.
Those focused on purchase transactions you won’t be affected as much on the interest hikes.
Purchase transactions aren’t typically affect by the interest rate.
But...
It's still not a bad idea to look to diversity.
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The fix and flip market is still very strong. This market is not driven by interest rate.
The best diversification is to consider is small balance commercial real estate.
Since most residential professionals feel they “don’t understand” the commercial side, this space is less crowded.?
Part of the fear is the sense that commercial loans have vastly different lending processes & guidelines when compared with residential transactions.
According to Boxwood Means, the leading national provider of commercial evaluations and research for small commercial properties, the sweet spot remains loans below $2 million.
The needs of private buyers and small business real estate owners for smaller loans is always the key driver of this loan space.
Small balance lenders, brokers and investors have every reason to be upbeat as vigorous CRE space market conditions remain buoyed by the modest pace of growth in the U.S. economy.
When you partner up with a lender that specializes in the commercial lending of all type.?The fear of the unknown goes away.
It will also give you a diversification in your business that will withstand interest rate swings.
Contact Ralph Abbott at 614-339-4255 or email at [email protected] to help you diversify your business by getting in the small business commercial real estate space.