Home Business LenderPulse Q4 2023 survey: Mortgage pros still see opportunities in the housing market

LenderPulse Q4 2023 survey: Mortgage pros still see opportunities in the housing market

by Joshua Garcia

Despite recent layoffs caused by the Federal Reserve’s fight against inflation, mortgage professionals are still finding opportunities in the market. According to a recent survey conducted by HousingWire, the top three opportunities identified by mortgage professionals are new construction, first-time homebuyers, and cultivating referrals and building new relationships.

New construction was identified as a lucrative opportunity by 15.3% of surveyed professionals. With housing demand remaining high, new construction can provide a steady stream of business for mortgage professionals. First-time homebuyers were also seen as a significant opportunity, with 14.5% of respondents identifying them as a key market segment. As millennials and younger generations enter the housing market, catering to their needs and preferences can be a profitable strategy.

Building relationships and generating referrals from buyers, builders, and agents was another notable opportunity mentioned by 13% of surveyed professionals. Establishing strong connections within the industry can lead to a consistent flow of clients and referrals.

The survey also highlighted other successful strategies used by mortgage professionals, including finding investor clients and utilizing non-qualified mortgages (non-QMs), down payment assistance programs (DPAs), and home equity line of credits (HELOCs).

Despite the challenges faced by the industry, mortgage professionals have not hesitated to invest in their growth and development. Over half of the respondents (51%) reported spending money on reaching potential clients, while 37% invested in social media marketing and 34.8% allocated funds for events. Digital marketing, automation technology, and market data were also identified as areas where professionals are investing resources.

When looking at the outlook for the mortgage business, the survey revealed mixed expectations. About 45.2% of professionals projected that purchase mortgage origination volume would remain flat in the next three months, while 36.3% expected a drop of more than 5%. On the other hand, 18.5% anticipated a rise in purchase mortgage units of more than 5%.

In terms of interest rates, the majority (64.4%) of respondents believed that rates would remain flat in the fourth quarter. However, 23.7% expected rates to increase, while 11.9% foresaw a decline. The Federal Reserve’s projection of one more rate hike by the end of the year aligns with these expectations.

The challenges faced by mortgage professionals in the fourth quarter include elevated housing prices, lack of inventory, and loans falling through. Rising home prices, in particular, have made affordability a concern, especially for first-time buyers. These challenges underscore the need for creative solutions and strategies to navigate the current market conditions.

Despite some pessimism about the economic climate, with 38.5% of respondents expressing pessimism and 14.1% expressing optimism, 47.4% remained neutral. The uncertainty of the economic landscape adds another layer of complexity to the mortgage business but also presents opportunities for adaptable professionals.

Overall, the survey highlights the resilience and adaptability of mortgage professionals. Despite the challenges posed by the Federal Reserve’s actions, industry professionals are finding ways to thrive in the market. By identifying and capitalizing on opportunities, investing in professional development, and staying informed about market trends, mortgage professionals can navigate the current landscape successfully.

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