Will 2020 Be a Repeat of 2019 for Mortgage Rates?
The start of every New Year brings with it both a sense of excitement and a sense of worry, especially for those in the real estate and mortgage businesses. The reason for this is because the market can be so terribly difficult to predict, so it leaves you feeling hopeful on one hand, but a little wary on the other.
This coming year is an important one because it is the start of a brand-new decade. So, what should you expect? Here’s what many experts are predicting for the mortgage industry in 2020.
Rates Fall; Prices Climb
This year, housing prices climbed at a steady pace, and that’s not expected to change in 2020. Prices are being driven skyward due to all the usual reasons – high demand and limited inventory. According to property data firm CoreLogic, home prices can rise by as much as 5.6% by next September. Prices are expected to see a lot of movement in the earlier part of the year, when inventory will be at its slimmest.
While prices are expected to rise, interest rates are expected to continue to fall. This may be the one saving grace to keep the industry from bottoming out. Freddie Mac’s mortgage rate is currently at 3.75%, nearly a 1% difference from the monthly average a year ago. Forecasts from Fannie Mae have the interest rate falling as low as 3.5% in 2020.
Refinances Will Surge
Mortgage brokers will see a lot of business come their way in 2020 from existing homeowners looking to refinance to take advantage of the historically low rates. This is a trend that started in 2019, and it shows no signs of slowing down next year. In fact, it looks to be an even stronger market for those wanting to refinance.
Starter Home Competition Will Be Tight
Starter homes tend to consist of properties priced at lower price points, and this is one area that will see intense competition in 2020, making things especially challenging for first-time buyers. The reason is because builders aren’t building entry-level homes anymore. Instead, they’re focusing on building expensive homes, so they can drive higher profits.
Homeowners Aren’t Really Selling
Another problem facing buyers is the fact that homeowners are choosing to stay in their homes for longer periods, and this is expected to continue in 2020. In fact, according to Redfin, the average homeowner is staying in their home 13 years, with some cities seeing homeownership tenures as long as 23 years. By comparison, in 2010, the average homeowner stayed in their home for just eight years.
Mortgage Leads Will Remain a Primary Means of Landing New, High Quality Clients
As much as the mortgage industry changes, one thing remains the same – mortgage leads will always be a valuable resource for mortgage companies looking to increase their business. Buying mortgage leads from a reliable provider, like RGR Marketing, is one of the most proven and effective ways to find people who are considered “hot” candidates for mortgages.
These leads are verified and validated for accuracy and quality, so a lot of the work is already done for your sales team. If you’re ready to build your business with leads that are ready for closing, then contact RGR Marketing today and see for yourself how high-quality leads can make a difference.
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