Challenges will linger, but Rocket exec says opportunity is there if brokers know where to look
There’s little chance of a huge US mortgage market boom in 2025 – but the industry is in good shape to capitalize on as much business as possible in the coming 12 months, according to an executive at one of the nation’s mortgage giants.
Dan Sogorka (pictured), general manager of Rocket Pro TPO, told Mortgage Professional America nobody was under any illusions about the distant prospect of deep interest rate cuts and a market surge in the year ahead, but a brisk clip of business still appeared to be in the offing.
That’s been illustrated by a busy end to the year. “Brokers want to really charge right through the end of December. We’re not really seeing a slowdown,” Sogorka said. “I think everybody’s kind of preparing for 2025, which is shaping up now. The thought about a million interest rate cuts might not be the case.
“So everybody’s thinking, ‘OK – this is the market. This is what we’ve got to work with. Let’s make sure we’re working with the right partners and have the right tools and let’s buckle down and get after it.’”
How are interest rates impacting the mortgage market?
Fannie Mae’s latest forecast for the 2025 housing market indicated expectations of little change in existing home sales and a marginal bump for new home sales.
Mortgage rates remain high compared with their level during the COVID-19 pandemic, although they’ve ticked down slightly in recent months from the highs seen in 2023.
Those rates remain prohibitive for many buyers, especially those purchasing for the first time. Still, Sogorka said even mild downward movement on rates in the year ahead should spur some fresh interest in both homebuying and refis.
Dave Thomas, Union Home Mortgage branch manager, believes the current mortgage crisis is tougher than 2008 and stresses the importance of personal client connections despite rising AI use.https://t.co/XfVgp077m8
— Mortgage Professional America Magazine (@MPAMagazineUS) December 11, 2024
“First-time homebuyers are at their highest age ever,” he said. “You don’t have that younger first-time homebuyer market to really focus on – but we’re seeing every time we get a little movement on rates, both purchase and refinance pick up.”
Top of mind for Rocket in that climate: maintaining clear and constant communication with partners, Sogorka said, deepening relationships and making sure the industry is primed for whatever opportunities come their way.
“Let’s stay really close. Let’s stay on top of it,” he said. “Let’s keep working with folks in the community, getting the word out about who you are and what you do and then when deals materialize, [we can] be there ready again with the right technology, the right programs, the right process to get things closed and provide certainty and clarity in the transaction.
“As a community, I think we’re focused on what we can control. That means controlling costs, getting our messaging [optimized], taking big swings and focusing on opportunities when we have them to increase our win rates. And then as the market cooperates, we’ll be there and ready to capitalize.”
Mortgage rates unlikely to see big drop in 2025
The US labor market has shown plenty of resilience throughout 2024 with the economy also defying expectations of a big slowdown – and while the Federal Reserve is expected to reduce its funds rate when it meets this week, there seems little chance at present of a flurry of rate cuts in 2025.
Mortgage rates, meanwhile, are widely predicted to continue hovering above the 6% mark. “Even by the end of next year, it’s hard to see sub-6% mortgage rates,” First American chief economist Mark Fleming indicated in his forecast for the year ahead.
Redfin believes the average 30-year fixed mortgage rate should linger around the 6.8% mark in 2025, while Fitch Ratings predicts the average could slide as far as 5.8% – or to an upper limit of 6.4%.
That means brokers are unlikely to face a huge surge in calls inquiring about a possible home purchase– but Sogorka said overall prospects for the market are positive as 2025 looms into view.
“It’s just about identifying how you’re going to win purchase business and what you need to do for that,” he said. “I encourage people who have relied on refinance to try to branch out into that area.
“We have a great team and great partners – and I think next year is going to be really impactful. So I’m excited.”
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