Perception, Purchases & Optimism in Today’s Changing Homeowner Market

November 17,2022
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Signals in the housing market have been pointing to a drastically different picture of homebuyer perceptions in 2022 as higher interest rates and home affordability weigh on people’s minds.
 
What can credit unions, loan officers and member representatives do to assist prospective buyers who want to own a home? How can mortgage departments drive new business in a market that vastly differs from the past couple of years?
 
One thing is certain: In this year’s unfolding drama, your credit union should always be seeking to engage borrowers at the very beginning of their home search. Your members and potential members are bombarded by financing opportunities on mobile apps and website listings well before they officially enter the market. This direct-to-consumer presence will most likely drive the purchase-mortgage market going forward.
 
However, credit unions have a leg-up. Coming out of the COVID-19 pandemic, many have the strongest-ever relationships with their members and have built closer bonds with individuals compared to big banks, fin-techs and independent lenders.
 
Are you leveraging every opportunity, marketing, financing, engagement tool or digital channel you can think of? Consider the current state of buyers in today’s market:
   
  • Remote and flexible work arrangements between employers and employees are making a huge imprint on buyers’ housing preference, according to a recent survey by Fannie Mae. In today’s purchase-driven market, a large proportion of buyers have non-traditional employment relationships since they are actively searching for how to integrate work at home. Balancing time, energy, lifestyle and work commute or related expenses is key.
 
  • The refinance boom is gone for now but home purchases remain a solid market, according to a recent Freddie Mac forecast. Total U.S. purchase/refinance originations combined will most likely decline from $4.8 trillion in 2021 to $3.1 trillion in 2022 and $2.8 trillion in 2023. However, purchase mortgages are likely to make up 68 percent of this year’s total origination volume and 79 percent next year.
 
  • Among potential homebuyers, three out of four across all races/ethnicities say they are currently saving for a down payment, according to a recent National Association of Realtors survey. Half or more say it will take between six months and three years to save for a down payment.
 
Engaging members from the ground-up through financial wellbeing, budget health, down payment guidance and homebuyer education couldn’t be more important. The seeds you plant now will have an impact on members and potential homebuyers going into the second half of this year and beyond.
by CU Members

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