Mortgage Applications Continue Rapid Decline

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Mortgage Applications Continue Rapid Decline

Michael Carbonare
Investor Β· Fort Lauderdale, FL Β· Member since 2013 Β· 929 posts Β· 615 votes

𝐓𝐇𝐄 𝐔.𝐒. πŒπŽπ‘π“π†π€π†π„ πŒπ€π‘πŠπ„π“ πˆπ’ 𝐈𝐍 πˆπ“π’ 𝐃𝐄𝐄𝐏𝐄𝐒𝐓 π‘π„π‚π„π’π’πˆπŽπ 𝐎𝐍 π‘π„π‚πŽπ‘πƒ
And the numbers are ugly. According to the Mortgage Bankers Association, purchase mortgage applications have fallen to just 131.4

For perspective:
47% below the 2018–2019 pre-pandemic norm
19% below the same time last year
Even lower than levels experienced during the 2008–2012 housing bust.

Fewer Americans are going out and buying homes with mortgages than at virtually any point in modern history.
Meanwhile, housing inventory has climbed past pre-pandemic levels in many markets, sellers are competing for a shrinking pool of buyers, and price reductions are becoming increasingly common.

The pendulum is swinging.
We're moving into a buyer's market, and in many areas, buyers have something they haven't had in years: LEVERAGE.

Discounts are available. Sellers are becoming more negotiable. Opportunities are emerging for those willing to look beyond the asking price.

The best opportunities often emerge when everyone else is running for the exits.
So, if you're one of those people who's been "waiting for the right time" that time is here.

Creative offers. . .creative deals. . they're back.
Seller financing. Lease options. Flexible terms. Deals structured around what works for BOTH the buyer and the seller.

You don't always need a pile of cash, perfect credit, or a mortgage from a bank to make a deal happen. You just need to know how to put a deal together.

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Christian Wamsley
Investor Β· Augusta Β· Member since 2024 Β· 41 posts Β· 28 votes
16h

Michael, I agree with the direction you're going here. I believe we're seeing opportunities that investors haven't had in quite some time.

One thing I'd add is that a buyer's market doesn't automatically make every property a good investment.

From both the investor and broker side, I think this is where understanding your numbers and financing strategy becomes even more important.

With sellers becoming more negotiable in certain markets, investors have opportunities to look beyond just reducing the purchase price. Seller concessions, closing cost assistance, interest rate buydowns, and creative financing structures can all play a role in making a deal work.

But here's where I'd challenge investors.

Before getting excited about the discount or creative structure, ask yourself: Does this property actually support what I'm trying to accomplish?

If you're flipping, does the ARV support your purchase, renovation, financing, and holding costs?

If you're buying rentals, does the cash flow support the debt and still leave you with a reasonable return?

And most importantly, do you understand how you're going to finance the deal before making the offer?

I believe the opportunities are there, but the investors who understand their numbers, negotiate the right terms, and have a clear financing and exit strategy will be in a much better position to take advantage of them.

Sometimes the best deal isn't the one with the biggest discount. It's the one with the right numbers and terms that support your investment goals.

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  • Jaron WallingPro Member
    Rental Property Investor Β· Indianapolis, IN Β· Member since 2018 Β· 4k+ posts Β· 4k+ votes
    17h

    My neighbor just sold there house. It was a probate sale that took over 6 months to sell. It was poorly priced but nicely remodeled just last year. Started at $265k, price drops, and sold for $215k to a cash buyer. It's the perfect starter (great school district) or downsize property, but it doesn't matter when supply is way up, interest rates are 7%+, and we're stuck in a war with Iran. 

    It's won't CF today as rental (no value add either) but an investor could get $1850 per month for it. Give it 5 years and rents will be $2100. It's a great starter or downsize property, but it doesn't matter when supply is way up, interest rates are 7%+, and we're stuck in a war with Iran.

    0Reply
  • Christian Wamsley
    Investor Β· Augusta Β· Member since 2024 Β· 41 posts Β· 28 votes
    16h

    Michael, I agree with the direction you're going here. I believe we're seeing opportunities that investors haven't had in quite some time.

    One thing I'd add is that a buyer's market doesn't automatically make every property a good investment.

    From both the investor and broker side, I think this is where understanding your numbers and financing strategy becomes even more important.

    With sellers becoming more negotiable in certain markets, investors have opportunities to look beyond just reducing the purchase price. Seller concessions, closing cost assistance, interest rate buydowns, and creative financing structures can all play a role in making a deal work.

    But here's where I'd challenge investors.

    Before getting excited about the discount or creative structure, ask yourself: Does this property actually support what I'm trying to accomplish?

    If you're flipping, does the ARV support your purchase, renovation, financing, and holding costs?

    If you're buying rentals, does the cash flow support the debt and still leave you with a reasonable return?

    And most importantly, do you understand how you're going to finance the deal before making the offer?

    I believe the opportunities are there, but the investors who understand their numbers, negotiate the right terms, and have a clear financing and exit strategy will be in a much better position to take advantage of them.

    Sometimes the best deal isn't the one with the biggest discount. It's the one with the right numbers and terms that support your investment goals.

    2Reply
    • Michael Carbonare
      OP
      Investor Β· Fort Lauderdale, FL Β· Member since 2013 Β· 929 posts Β· 615 votes
      16h

      You're a wise man, Christian. Thanks for sharing.

      0Reply
  • Noah WrightBusiness Member
    USA, Nationwide Β· Member since 2024 Β· 353 posts Β· 126 votes
    14h

    You're right that seller carry and flexible terms are showing up again, and that's a real opening for anyone who can put a deal together. On the lender side of this, the structure still has to fit the loan sitting behind it. A lot of DSCR lenders won't allow a seller carried second at all, and the ones that do usually cap the combined loan to value. Seller credits hit a similar wall, since most programs I see cap concessions at a few percent of the price. Your credit score and experience still decide how much the lender will put in, discount or not. The seller decides what they'll accept, the lender decides what it'll sit behind.

    [email protected]737-773-3717
    1Reply
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