Preparing for 2015 in the Housing Market
The year 2015 is shaping up to be one full of surprises and monumental advances in the mortgage industry. As the holidays approach and the housing market peters off with the introduction of cold weather and hectic schedules, we are able to take a step back and consider what is to come in the market and how best to prepare. Looking back on 2014, we saw mortgage rates fluctuate drastically, the housing market make some impressive strides towards improvement, and rules and regulations subjected to multiple adjustments. So what is the best way to approach business in 2015 to ensure your company excels? Let’s explore the two main qualities that will be essential to adopt in order to survive a unique year in the housing market: flexibility and adaptability.
Housing values and mortgage rates gradually began working together in 2014 giving homebuyers the conditions they needed to make home ownership more affordable, reliable, and accessible. Since the crash of the housing market approximately seven years ago, the market continues to struggle to recover and gain stable footing in an economy that is also still on the mend. The rapid and incredible decline in the housing market naturally has left consumers wary even to this day. Most approach the idea of buying a home uneasily after witnessing or becoming a victim of the crash. This is a major hurdle the industry must overcome. While 2014 was a productive year for recovery, we have a long way to go before we see a completely stable market. The year 2015 seems to be headed towards buoying itself as another recovery and stabilization year. But progress towards a balance between the housing market, economy, and consumer confidence is a gradual one. The industry has made changes to prevent another catastrophic decline from happening again. And while the industry has made these advancements and improvements, only time can fix the last remaining broken pieces. Consumers need time to begin trusting and engaging in the market once again.
In order to complete the recovery process, rules and regulations continue to be subjected to amendments with the promise of boosting the economy and assisting homebuyers. Stronger and more stringent guidelines allow borrowers to obtain the mortgage loan that best fits their financial situation while preventing defaulting on the loan in the future. This is where flexibility and adaptability become essential. The housing market is known for its continuous changes and fluctuations when it comes to pricing, rates, and mortgage loan products. Companies are expected to remain on top of their game and deliver critical, up-to-date information on these topics at any given moment. Throw in new and adapted regulations that must be followed and the recipe for a downward spiral has been written. It is crucial that a professional company be prepared and willing to adapt just as quickly as the changes are made. Being flexible and adhering to new rules quickly proves a company’s knowledge, expertise, and foundation in the field.
The housing market crash forced many businesses out of the market. So what’s the difference between businesses that crashed along with the market and those that were able to ride it out? Adaptability. Companies were forced to quickly learn how to protect consumers, provide tools and advice needed in stressful situations, and recreate business models that worked more fluidly in the new economy. I believe the key is to develop and implement policies and guidelines that are rigid and accurate but that can be edited to best fit current situations in an ever-changing industry. It is also important to maintain flexibility. Many companies tout flexibility as a main characteristic when conducting business with clients, partners, and consumers through providing customer service that meets the needs of each unique situation. This same flexibility is key when dealing with the government and regulators. Always be prepared to make the changes necessary to continue abiding by all laws of the industry. An open mind will also help give you the wiggle room necessary to be successful. A company that is flexible and able to adapt to changes is better equipped to provide the service necessary to survive in an incredibly competitive industry.
Both the crash of the housing market and the explosion of information saturating society have prodded consumers to take a more involved and active role in their decision-making process. By conducting research on the Internet and social media and becoming educated on their options, consumers have thereby demanded companies provide relevant information and unparalleled service in order to earn their business. Where does that leave mortgage companies today? Only the fit will survive! Being able to effectively and quickly adapt to the economy allows the focus to remain on the consumer by offering exceptional customer service. No consumer is going to choose to work with a company flailing to figure out how to adjust to a fluctuating market when another company has it dialed in and is prepared to go about business as usual. The focus must remain on the consumer and their needs during what can be a stressful and confusing process. Don’t fall victim to poor business practices due to lack of preparation. A business should have the sole focus of providing an exceptional service and product without the consumer ever knowing your business model has been turned on its head behind the scenes.
So how do you elevate your company as being flexible and adaptable in the marketplace? Keep an eye on the news. Future changes and new policies are generally announced months in advance giving businesses ample time to prepare. By remaining on top of the news and following important mortgage news sources, you will be able to anticipate future changes through trends. Develop a process to follow when adjustments need to be made. Amendment, implementation, and notification are the three common steps taken when adapting policies and regulations. Existing policies need to be updated to reflect the latest changes. They then need to be implemented in the workforce. And all employees must be notified of the changes and provided training where necessary. The smoother this process flows, the more quickly business will adjust, resume, and succeed.
Set up your business for success in 2015 by adopting a flexible and adaptable attitude. The market is not done trying to right itself after its dramatic decline. Companies are still struggling to keep up and business in the industry is still fighting to climb to a stabilizing level. Avoid becoming the next company unable to cope with the changing market. Establish a well-constructed business plan for 2015 that gives you room to grow, adapt, and bend in all the ways the market will demand. The year 2015 could very well end up being the year we need to finally see the growth, confidence, and stability in the market that will boost the industry and carry its success into the future.
Written By Ashley Lubey. Originally published in National Mortgage Professional Magazine, December 2014.