MBA Conference: MasterCard and Mortgage

The third day of the MBA’s 2017 Independent Mortgage Bankers Conference featured two high-powered speakers back-to-back: Sarah Quinlan, Senior Vice President and Group Head of Market Insights for MasterCard Advisors and Michael Fratatoni Ph.D., Chief Economist and Senior Vice President of Research and Technology for the Mortgage Bankers Association. Quinlan’s interpretation of spending and consumer behavior and Fratatoni’s predictions for 2017 provided a fascinating juxtaposition of insight and analysis.

Quinlan and her team analyze 160 million credit card transactions per hour to formulate their theories. Quinlan said millennials don’t “see real estate as a way to wealth,” explaining that they will want to know what their return on investment will be and to have liquidity in case their lives change. Some of these conclusions might be alarming to mortgage and real estate professionals, but knowing potential buyers may have these underlying thoughts can be helpful in knowing how to approach and educate them.

Quinlan provided other insights about the American populous in general that should be taken into consideration when putting together your marketing and sales presentations, including:  

  • We’re living closer to work and not moving as often.
  • We’re shopping online, but not buying online.
  • Women are making 75% of transactions.

Dr. Fratatoni’s presentation for the MBA was optimistic; he said that “the MBA is relatively bullish on the housing market going forward,” because:  

  • Housing prices rose in 2016 and surpassed the 2007 peak.
  • Americans are regaining home equity as housing prices have increased.
  • Rents are rising at double the rate of inflation.
  • 1.6 million new households will be established each year – and they’ll need to be financed.

Any of the above can be used to highlight why it’s a good time to make a move – whether it’s buying a first home, moving up, or even selling to downsize. Fratatoni also joined the interest rate speculation fray, estimating that rates will be higher this year, but he predicts we’ll still end 2017 below five percent. While millenials don’t believe real estate is a way to build wealth, the market data still supports the possiblity of making our housing dollars multi-task at rates that are still historically favorable.

When it comes to housing, there’s never a shortage of predictions, punditry or data. The most successful companies and MLOs will identify and address their different target audiences and communicate with them consistently about the latest trends, information and opportunities.