MORTGAGE BLOG

Why Some Home Financing Incentives Fail to Deliver Results

Blog posted On January 09, 2025

By Contributing Author Anthony Grasst, VP National Builder Division

Affordability is the number one challenge in today’s housing market, and builders everywhere are searching for solutions to engage hesitant buyers. Mortgage rates and financing incentives are widely recognized as the answer, but why aren’t they driving sales as they should?

As someone who works closely with builders and sales teams across the country, I often hear this frustration: “I’ve tried financing incentives, but they didn’t work.” These challenges aren’t insurmountable, but they often come down to four critical issues:

Mortgage Rate Projections: Two Paths Forward or Uncharted Territory?

Blog posted On December 20, 2024

By Contributing Author Anthony Grasst, VP National Builder Division

Mortgage rates have been a big topic lately, and it’s no wonder why. One of the most common questions I hear is, “When will mortgage rates come down?” Rates are important, but they’re just one piece of the affordability puzzle. Buyers are also struggling with high home prices and tighter cash flow caused by inflation. These factors together are squeezing affordability, and buyers are eager for solutions. It’s the kind of question that directly impacts how you approach buyers in today’s market.

I usually answer this question by offering two potential paths. Here are two paths forward based on a recent economic forecast from FHN Financial.

Mortgage Rates Spike: Affordability Strains, But Opportunities Remain

Blog posted On November 08, 2024

Market Update: With rates now averaging 7.13%, buyers face higher costs while builders navigate an affordability crunch. Here’s how we can turn these challenges into sales opportunities.

Mortgage rates increased to 7.13% after the election, a jump that highlights the financial pressures impacting buyers and builders alike. The recent rise in rates reflects broader economic trends, including inflation concerns and Treasury yield shifts, which have kept rates elevated. This high-rate environment is dampening buyer affordability and weighing on builders, with monthly payments on a $400,000 home now up 11% since early September.

Why Lower Interest Rates Won’t Solve the Affordability Challenge for Home Buyers

Blog posted On September 13, 2024

Mortgage rates may have come down slightly, but affordability remains a significant challenge for home buyers, particularly as home prices continue to climb. Typically, rising rates cause home prices to cool, however the current market is anything but typical. The latest U.S. National Home Price Index from S&P CoreLogic and Case-Shiller shows that home prices reached record highs in June, despite rising interest rates.

Addressing Affordability Challenges in Today's Housing Market: Effective Financing and Marketing Strategies for New Home Builders

Blog posted On July 31, 2024

By Contributing Author Anthony Grasst, VP National Builder Division

Current Market Issues and Challenges

The housing market is facing significant challenges. According to a recent survey by the Mortgage Bankers Association, many potential home buyers are waiting to purchase in hopes that interest rates will go down. The decision for many to wait is causing an overall drop in mortgage demand. This trend is exacerbated by rising home prices and high mortgage rates, both of which have contributed to a decrease in affordability and buyer hesitation.