We can’t believe that 2019 is almost over! It has been a great year, and we are excited to see what 2020 has in store. The Mortgage Bankers Association (MBA) recently published their MBA 2020 Economic and Mortgage Forecast, and it appears 2020 is coming in strong. Here are some predictions from the report that real estate investors should note related to non-QM, 30-year fixed rates, and SFR originations.
The opportunity for non-QM is not slowing down. As the post-crisis regulations were set into place, many credit-worthy borrowers defaulted into non-QM products. In 2019 alone, non-QM grew 400% with over $5.7 billion securitizations in Q1 2019. That’s almost half of all the 2018 volume. While it is predicated that rates will go back up in 2020 and refinances will decrease, non-QM loans are not going anywhere.
Additionally, non-QM loans are safer and a more viable alternative to self-employed borrowers, and according to Everland, there will be 42 million self-employed individuals in the United States in 2020.
30-Year Fixed Rates
The MBA Report predicts that 30-year fixed mortgage rates will slightly increase in 2020. However, there is no reason to worry. As the desire to rent in an ideal location is growing, market rent is simultaneously growing. For instance, rent prices in hot spots like Las Vegas, Phoenix, and Miami have increased 3% year over year.
Mortgage Originations for SFR Properties
The MBA Report predicts that SFR properties will see an up-tick in Q2 and Q3 of 2020. For investors to looking to buy at slower times, consider shopping in Q1 and Q4.
Need a non-QM loan originator for rental properties in 2020? Contact Visio Lending.