Who Are They Going to Call?

The help that borrower’s need to make informed decisions in these uncertain times is the key to profitability in home finance. People are still counting on home to be their greatest asset, and they are still venturing their futures based on it. The more we live up to the role of trusted advisors, the more our customers and our whole industry will prosper.

Despite a couple of months of marginal decline at the end of 2020 – less than 2% – the desire to own one’s home is still a uniquely powerful part of the American economic landscape. More than 65% of Americans now own their homes, and 2020 saw a surge in buying – despite extraordinary events in the general economy. The blend of this desire to own, a change in perspective during stay-at-home precautions, and historically low interest rates depleted existing housing inventory – January’s inventory was 42.6% less than the year prior, the lowest inventory on record.

The Value of Counsel

Homebuyers do well with guidance, even in the best of times, and during dynamic shifts such as the ones we are seeing today, we can expect our counsel to make more of a difference than ever. Even with growing use of public sites such as Zillow, Trulia, and Homes.com, still more than 88% of recent buyers work with a real estate agent or broker. With a combination of more mortgage options available and more consistent standards to qualify for them, buyers frequently seek the help of mortgage brokers, too.

Whether the counsel comes from an experienced broker or banker who has familiarity with the market, the applicant, or both, the value of mortgage counsel today goes beyond access to sources and shortcuts in legwork. The changing dynamics of 2020 are largely still in play, with people reevaluating the kind of home that works for them and where that home can be located. Matching the mortgage to the goals of the homebuyer is more important than ever, and experience counts.

Stakes are On the Rise

The rate of homeownership in the U.S. has rebounded steadily since 2016 to more than 65%, just four points below the all-time high of 2004. As ever, the mortgage market plays a key factor in that growth, with 87% of recent buyers financing their homes. The proportion of selling price that is financed remains substantial, typically 88% of the purchase price, and 93% among first-time buyers.

With so much of the housing market dependent on good mortgage counsel, it makes sense to work together in providing what only experience and perspective can provide. Matching buyers’ goals with mortgage terms and structure is just as important as ever, and even more dynamic than ever, in the marketplace where we work today.