Non-bank mortgage employment jumped 5.9%, while banks added 4% more jobs in the sector over the same time period. Banks also saw particular job growth in residential lending, which increased by 6.8%.
The increase in job growth is being attributed to rising home prices and low interest rates, as well as record levels of job creation in other industries. Low unemployment, high consumer confidence, and increased demand for housing have all helped fuel this growth. Mortgage bankers are benefitting from the growth as well, since more people are qualifying for home loans with lower credit scores.
The uptick in job growth is also setting the stage for increased competition among non-bank and bank lenders. There has been a surge in lending activity, with non-banks making more loans than traditional lenders for the fifth consecutive quarter. This is leading to tighter margins and increased competition in the mortgage industry. Banks are responding by offering more competitive products that appeal to both non-bank and bank lenders.
The increase in lending has been especially beneficial for minorities and first-time homebuyers, who often face more difficulties accessing financing than other buyers. The National Association of Hispanic Real Estate Professionals (NAHREP) found that the homeownership gap between Hispanic and white households narrowed by two percentage points in 2020, due in part to increased access to mortgage financing for minority buyers.
Overall, the first quarter of 2021 has been a strong one for non-bank mortgage brokers and bankers, thanks to increased job growth, stronger competition, and improved access to financing for minority and first-time buyers. The favorable conditions in the housing market are likely to continue in the coming months, creating an even more attractive environment for job seekers in the mortgage industry.
This article was contributed on Oct 18, 2023