It’s Crunch Time For Real Estate And Mortgage Professionals
By CHUCK GREEN
It is the beginning of April, and in many parts of the country, real estate and mortgage professionals are celebrating the start of the spring homebuying season.
In some ways, the season began months ago, according to Licensed Real Estate Broker Paul Zweben of The Zweben Team at Compass in New York. He says the people who hit the market this spring likely made up their mind to buy a home at the beginning of the year.
“People go out on New Year’s Eve and then wake up on New Year’s Day and many say, ‘I need to get married; I need to get divorced; I need to have a third child, I need to move to Westchester…’” Zweben said.
Jimmy Parsons, branch manager at Guild Mortgage Company in Montgomery, Alabama, and Melissa Condensa, producing branch manager at Guild in Plano, Texas, said their markets are stable moving into the spring season.
“I’ve found in my recent conversations with real estate agents, builders, and peers, most are optimistic about 2025. There seems to be a renewed hope that the market will be strong,” Parsons said.
With a few exceptions, Condensa said median home prices have increased over the last 12 months, despite mortgage rates being higher.
What do economists think?
Odeta Kushi, deputy chief economist at First American Financial Corporation, said from her perspective, “the spring season is the most important time of the year for the housing market.”
According to data from First American, historically, approximately 36% of home sales for the year occur from March through June, Kushi told The Mortgage Note.
The housing market’s seasonal pattern is driven by factors such as weather, holidays, and the traditional school year schedule – “all of which make spring and summer a more optimal time for moving for many potential home buyers.”
Broadening the lens, Michael Sachdev, CEO of Snapdocs, an AI-powered digital mortgage closing platform, recently hosted a webinar, “Economist Roundtable: Making Sense of the 2025 Mortgage Market.” Participants included Kushi and Logan Mohtashami, a lead analyst at HousingWire.
The discussion focused on 2025 mortgage industry forecasts, as well as the macroeconomic factors that influence where the mortgage market is headed.
Sachdev posted his key takeaways from the discussion, which he titled “Economists Weigh In: Is the Mortgage Market Healthier Than You Think?”
“Overall, the housing market is healthier than most people think, with historically high credit scores, strong home equity, and improving inventory levels that point towards a gradual return to normal in the purchase mortgage market. The ‘lock-in’ effect created by historically low mortgage rates in 2020-21 is depressing the refinance market. Based on this, the consensus view is that the whole mortgage market (purchase + refinance) will see a slow, steady recovery — closer to 5% growth per year for the next few years.”
Four factors shaping the consensus view:
1. Interest rates are likely to stay in the 6% range
2. Loan origination volumes will improve as inventory increases
3. Millennials have entered peak earning years and are driving demand for housing
4. Affordability is improving, and borrowers have the financial strength to buy
What’s more, on paper, borrowers look strong while those who own a home also boast “significant home equity” to apply toward what they acquire next.
What’s happening in the luxury market?
Philip White, president and CEO of Sotheby’s International Realty, told The Mortgage Note that following a period of high interest rates, global elections, and fluctuating economic markers in 2024, the luxury housing market is showing impressive adaptability.
“Despite economic uncertainties and global geopolitical shifts, the luxury real estate sector has demonstrated remarkable resilience historically. Our most discerning investors and high-net-worth individuals continue to exhibit unwavering confidence in premium properties,” he said.
White said that’s reflected by Bank of America Private Bank’s findings, which showed that these buyers dedicate about 32% of their investment portfolios to real estate holdings.
“This substantial allocation underscores the prestige and value of exceptional properties,” White said.