There are a few major topics that should be explored as we look ahead to 2023. The first is the industry-wide revolution in business that is occurring in the mortgage sector. The Fed’s anti-inflation strategy, the rapid slowdown in lending that has led to a 40% drop in applications, the rising cost of mortgage production—which has now surpassed the $10,000 per loan threshold and the ongoing push toward digitization in mortgage lending are some of the factors that have contributed to this.
The availability and affordability of homeownership are the second major development. Never before have home prices been higher, pent-up demand greater, and housing supply scarcer. Even the ordinary home buyer finds these circumstances difficult, let alone those who are low-income or members of minority groups.
According to a growing consensus in both the public and private sectors, more has to be done to assist consumers, particularly underrepresented buyers, in preparing for homeownership and bridging the affordability gap. Many mortgage and housing companies are taking on fresh ideas and activities in this sector. Similar to this, big lenders are growing their ESG and social responsibility initiatives. The dedication is genuine, and it just seems to be growing stronger.
The regulation of issues with affordability and inclusivity in homeownership is receiving a lot of attention and momentum. At the FHFA, FHA, HUD, and Ginnie Mae, this is a top priority. These organizations are working to develop innovative solutions that will increase housing affordability and homeownership opportunities. For instance, one of the biggest lenders in the country recently disclosed that it is piloting a new program that would provide first-time homebuyers in black and Hispanic communities in five major cities with zero-down mortgages with no closing expenses. Click here to read more.