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Financial news outlets and those covering the U.S. residential real estate market are predicting a variety of scenarios in relation to recent increases in mortgage rates and inflation. The impending slowdown in the pandemic-fueled housing boom has been compared by some to the beginning of the dramatic market downturn in 2007. The Hatfield Weir Gale Team knows that today’s big picture assures many favorable differences in comparison to 2007: New Lending Regulations resulting from the 2007 crisis mean fewer risky loans and mortgage delinquencies. Quality Credit Requirements by Lenders Borrower FICO scores on current first lien mortgages are at a record high average of 751. Record High Homeowners Equity The amount of cash a borrower can take out of their home while still leaving 20% equity on paper is at a record high nationally at $11 trillion, a 34% increase over 2021. Lower Total Mortgage Debt Mortgage debt is at a record low - less than 43% of current home values. Only 2.5% of borrowers have less than 10% equity in their homes, providing a generous cushion in the market.
While increases in home prices are cooling to some degree, we know that the Washington market remains strong. Click here for more details.
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