Mortgage Lender Sentiment Survey probes weaker 2018 sales growth
Improving sales and affordability of the US housing market requires increased supply of homes according to mortgage lenders.
Echoing calls from other stakeholders, lenders surveyed by Fannie Mae put increased supply at the top of the ‘wish list’ and 48% said “insufficient supply of homes available for sale” was cited as the main reason for tepid home sales growth in 2018.
Just 24% of respondents to the Mortgage Lenders Sentiment Survey said that interest rates were the cause of slower sales growth while 20% blamed high house prices.
Low consumer income was only seen as a key issue by 2% while the same percentage said sales growth was weakened by a "lack of mortgage products tailored for first-time buyers or low- to moderate-income families."
For low and moderate income buyers, “increasing the supply of housing stock” was deemed the most helpful measure for improving affordability by 45% of lenders, “offering consumer subsidies” was the choice of 18%, and 10% said “offering more loan choices”.
Consumer subsidies suggested include down payment assistance, assistance for closing costs, or a first-time homebuyer tax credit; while increasing the housing stock could be assisted by easing zoning regulations and density restrictions and renovating existing stock.
Lenders also said that Fannie Mae and Freddie Mac could improve the affordability gap by helping to fund affordable developments.