With the economy now on much firmer footing and more people back at work, Americans are entering the homebuying market in droves, stretching the staff of financial services providers thin and necessitating increased hiring to accommodate heightened demand.
April was a particularly robust period for home loan lending activity. According to the Mortgage Bankers Association, application volume for home purchases rose more than 7.5 percent on a year-over-year basis. The vast majority of those applying were looking for conventional loans, at 76.6 percent, with the average loan amount going to these applicants totaling $336,870.
Homebuying growth projected to stay strong
Spring typically signals an uptick in mortgage inquiries, with prospective homeowners eager to emerge from winter hibernation mode. This may suggest that the growth in borrowing may be more of a flash in the pan rather than a harbinger of what’s to come. But as the National Association of Realtors noted, it anticipates home sales – and, by extension, mortgage lending activity – to continue moving at a swift pace. NAR Chief Economist Lawrence Yun said he’s projecting existing-home sales for 2018 as a whole to total 5.6 million – up nearly 2 percent from 2017 – and expects an additional 5.7 million home buys by the conclusion of 2019.
“Overall, fundamentals remain solid, driven by a growing economy and steady job creation, which will sustain home sales in 2018 slightly above last year’s pace,” Yun explained.
Yun went on to mention that home sales would likely be even higher, but limited inventory may be cause for a number of would-be buyers to wait on the sidelines until supply levels gain ground.
College graduates in demand
The reduced inventory situation isn’t holding back mortgage service providers from looking for new blood to join their ranks. They’re particularly focused on recent college graduates, a number of whom are on the employment hunt themselves. According to recent survey data from CareerBuilder, the financial services sector is among the top five industries in the U.S. whose business owners are hiring newly minted university grads. The financial services sector’s drive to hire seems to be a microcosm of employers overall; 80 percent of companies plan on recruiting more college graduates this year, up from 74 percent in 2017. Not since the early 2000s have hiring expectations been greater.
If residential real estate construction firms can more effectively replace what’s been snapped up by a the seemingly voracious appetite of the homebuying public, it could signal additional hiring activity in the financial services sector to stay ahead of the crowd.