Good news! You read it here first. Next year, 2013, is the year the mortgage industry shakes off its tepid pace and gets on track for a robust recovery.
There’s only one caveat, and that’s what the government in its endless folly may do.
Any stringent move to austerity would choke off this recovery and let it limp along as it has the past couple of years.
Absent that, there are several favorable trends that will boost mortgages.
The Federal Reserve has promised to keep rates low until certain unemployment milestones are reached.
This means continuing low rates that will wring the last of the refinancings out of the system and encourage the purchase mortgage market.
Home values are now rising broadly in many (though not all) areas of the country, and this will motivate sellers to sell as well as buyers to buy what they will now see as an appreciating asset. Plus, we’ll get the mortgage equivalent of the dead cat bounce.
As home prices bounce up from their floors, buyers will want to buy before they get too high.
In addition, housing starts and the new home market, heavily reduced in the recession, seem to be coming back, and they will bring with them new construction jobs and plenty of trips to home retailers to furnish the new urban and suburban palaces.
And we have just reported that the third quarter saw a big growth in jumbo originations.
The nonagency market has been a desert the past five years and this is the start of what looks like a return to normal market functioning.
This holiday season has been tinged with sadness with the news of the killing of twenty children in a Connecticut school. To compound this atrocity there are many people who refuse to consider any gun regulation at all that might help reduce these horrific cases.
We hope that despite this atrocity, your holidays have been filled with happiness from all the usual places happiness is found—family, faith, satisfying employment, doing something good.
And if all goes well, that will all continue into 2013 as the mortgage industry gets back into the swing of a $2 trillion origination year and the hiring back to fill many open positions.
