Executive on what has become evident in the new environment
As mortgage and housing market activity dramatically slowed in the US over the last two years, a growing number of real estate and mortgage industry professionals started to gravitate away from the sector and toward other employment – but how has that impacted those who remain?
According to InGenius data, the number of valid loan officers across the US slid below 90,000 by the second quarter of 2023, a dramatic fall from the height of the COVID-19 pandemic’s red-hot market when LOs numbered more than 180,000 (Q3 2021).
Still, while the current market remains a challenging one for mortgage industry members and borrowers alike, it’s also benefited from the professional and dedicated approach of those who decided to stay the course, according to a prominent Detroit-based broker.
Samantha Shelton (pictured top), founder at Align Lending, told Mortgage Professional America that the industry had been viewed as an appealing one to enter during the pandemic because of the promise of big volume and booming business.
Some who entered during that period may have become disenchanted and exited the space – but most of those left are in it for the long haul, according to Shelton, and weathering the storm has primed them well for future success. “The market itself has shifted with the type of professionals that we have,” she said.
“If you paid attention from last year to this year [on] how many originators and even real estate agents left the market or got rid of licenses or maybe condensed and instead of having five states, they have two – what we’re seeing as a professional industry is that the ones that stuck it out and have gone through these tough times have really mastered that craft.”
Industry professionalism evident even amid challenging times
Higher mortgage rates and borrowing costs have served to squeeze many prospective buyers’ budgets and weighed heavily against refinance activity since the sizzling market of the pandemic. Still, Shelton said interactions with other brokers and referral partners had proven extremely productive even amidst those challenging times.
That’s been the case when dealing with real estate agents as well as originators. “I’m finding myself communicating at a higher level with industry professionals,” she said, “because we saw the market from before, through COVID, and now in a more difficult time to where we can see the light at the end of the tunnel.
Amir Nurani of Left Coast Leaders shares insights on the shift towards consumer-direct models in light of recent NAR changes, with support from AIME. https://t.co/jJOg2xpAai#MortgageBrokers #RealEstate #ConsumerDirect #AIME
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“I just think as a whole, we’re better at communicating with each other, real estate professionals and lenders, as well as just kind of having that negotiating power: our real estate agents being able to negotiate for our clients and then us, as originators, being able to confidently have those conversations with both your buyers and the seller agent.”
That’s a welcome change from the market of a couple of years back, when the influx of new professional into the mortgage and real estate spaces helped contribute to a somewhat “messy” environment, Shelton said.
How has the mortgage market evolved since the beginning of the pandemic?
Slashed interest rates during the pandemic saw mortgage market activity shoot through the roof, with national originations volume spiking to $1.36 trillion in the fourth quarter of 2020 but bottoming out at just $333 billion at the beginning of 2023.
Activity has remained subdued since with rates remaining elevated compared with the borrowing environment that prevailed throughout the pandemic, although a recent mortgage rate dip has spurred optimism that more favorable homebuying circumstances could be around the corner.
Some of those who entered the industry even partly because of that surging volume in 2020 and 2021 got involved for the wrong reasons, according to Shelton. “We had a lot of people getting into the industry because they just looked at it as quick, easy money,” she said. “‘I can hop on this train and make some money,’ and it got a little messy.
“And I think that the trend that I’m noticing is that the people that are left, and stuck it out, are true professionals.”
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