The Northwest housing market has taken a roller coaster ride in recent years.
Before the pandemic, prices in Seattle soared as the home of Amazon and Microsoft solidified its position as a tech hub. Home values in Portland and Boise rose sharply as transplants from California bid up prices.
Then came the pandemic and its housing boom, and home values in the Northwest went up even more. Now that the boom is finally over, home prices are taking a much-needed breather. According to the Federal Housing Finance Agency, home values in Washington contracted by 2.6% from the first quarter of 2022 to the first quarter of 2023, while values in Idaho and Oregon fell by 1.6%. All three states ranked near the bottom nationally in home price appreciation. (Montana and Wyoming bucked the trend, showing annual appreciation of 4.7% and 6.8%, respectively.)
That’s not to say the Northwest’s housing markets are crashing. It’s more accurate to say that price appreciation hit its logical limit and now has reached equilibrium. Job markets remain strong throughout the region. Idaho and Washington each posted robust job growth of 3.1% from May 2022 to May 2023, according to the Labor Department. Idaho was not far behind, with a solid growth rate of 2.7%.
Even after the recent retreat in prices, housing affordability remains a challenge throughout the region. In the Seattle metro area, just 28% of homes sold in the first quarter were in reach of families making the area’s median income of $144,000, according to the National Association of Home Builders/Wells Fargo Housing Opportunity Index. In Portland, the share was 30%, based on median income of $114,000. In Bend and Boise, just 15% and 21% of homes, respectively, are affordable for median-income families.
That litany of stats shows how sharply the Northwest market has shifted. That new reality means that having a mortgage partner you can trust is more crucial than ever.
To match the needs of the Northwest’s real estate market, LendSure offers some hot loan products that will help you build your business:
- 10/40 Fixed Interest Only program. Seattle’s median home price was $710,000 in the first quarter of 2023. At that price level, borrowers are looking for flexibility in terms of amortization schedules and qualifying parameters. Enter LendSure’s 55% DTI 40-year IO product. This innovative loan allows borrowers to show a debt-to-income ratio of up to 55%. What’s more, the 40-year amortization schedule lowers monthly payments, and the interest-only feature reduces payments even farther.
- DSCR loans for investment properties. LendSure’s debt-service coverage ratio (DSCR) program is designed to be attractive to property investors. LendSure looks at market rents to qualify the property (instead of considering only currently rented units to support the loan amount), creating an easier path to approval. In other words, not all units need to be rented. LendSure underwrites the investment property based on both current and future rent. For an explanation of our DSCR loans, see this short video.
LendSure has expanded its DSCR program beyond the typical one to four units—we make DSCR loans on properties with up to eight units.
- Jumbo Prime loans. The Northwest’s home prices range high enough that many mortgages fall into jumbo territory. LendSure’s Jumbo Prime program lets you meet that demand – while offering exceptional service levels and expedited funding times. LendSure’s program offers loan amounts as high as $3 million and LTVs up to 90%. We also have loan amounts up to $1.5 million for second homes and investment properties.
The LendSure Way
It’s simple. We make loans that make sense. We’re not in-the-box lenders. Of course, there are numbers and ratios, and data to consider, but we know that behind every file, there’s an individual with a unique circumstance seeking a loan. We work hard to offer our common-sense take on lending to borrowers seeking funding for the home of their dreams, another addition to their investment property portfolio, or refinancing of a currently-owned property.
Are you ready to grow your business? Conventional loan approval guidelines can be restrictive, but we want to offer our mortgage broker partners the education, tools, support, and guidance they need in order to say “yes” to more of their clients. This ensures happy borrowers and opportunities for bottom-line growth. What are you waiting for? Let’s get started!
Are you ready to benefit from a commonsense approach to lending? Contact us today to learn more about non-QM loans and how partnering with LendSure Mortgage Corp. can help grow your bottom line.