– or moving to one story homes. They’re looking at second homes for eventual retirement. Xers and Millennials are buying first homes – or moving up to a larger family home.
As the article mentions, this also puts a demand on related items, such as landscaping, pools/spas, outdoor furniture/kitchens, remodeling/decorating, home furniture and more.
Lots of good potential for spring, which is when many of these categories do their largest marketing push!
Mortgage Firms Betting on Continued Recovery
Mortgage companies are betting that the nascent housing recovery of 2012 has legs by beefing up their staffs to accommodate the continued expansion in lending, sales and construction that many economists forecast this year.
Wells Fargo Home Mortgage and other lenders are responding to increasing home sales and values, and to the Federal Reserve's commitment to keep borrowing rates near historic lows until the unemployment rate improves. That combination
of factors typically spurs both home sales and refinancing activity.
"It should be a very good year for housing," said James Chessen, chief economist of the American Bankers Association. "With house prices rising, it means that there will be more (homeowners) refinancing at low rates because the equity in their house is improving. It also means more people are interested in selling their house to buy larger ones."
Daniel Vessely, president of Iowa Bankers Mortgage Corp., said: "The Fed's commitment to keeping interest rates low has given people in the mortgage industry a little more confidence, because everyone agrees that we won't see the unemployment rate coming down anytime soon." The U.S. unemployment rate was 7.9 percent in January, versus 8.3 percent a year earlier.
Anika Khan, a senior economist at Wells Fargo Securities LLC, said there's no doubt that home sales, construction and prices have hit bottom and are in recovery mode. The West Des Moines-based bank reported that its mortgage originations rose 4 percent to $125 billion during the fourth quarter. "It makes sense," Khan said of the mortgage industry hiring spree.
"Inventories are very low, and that's the impetus for builders to get out there and ramp up activity. We're seeing that in every region of the country."
Wells Fargo's housing forecast calls for a 27.7 percent increase this year in housing starts -- a measure of new home construction -- from the 775,000 units begun in 2012. That means more work for idled carpenters and electricians, and an increase in demand for related products, such as barbecue grills, refrigerators and living room furniture.
Wells Fargo Home Mortgage, which handles about 30 percent of all U.S. mortgages, is adding staff and facilities across the nation. It's proposing to build a structure at its West Des Moines campus to accommodate 1,800 additional workers. It also announced plans in January to add more than 900 workers in Arizona, 100 in Georgia, and 90 in Alabama. The home mortgage division expanded its headcount by 18 percent to 17,945 full-time employees during the 12-month period ended July 1, according to Fitch Ratings. The largest bank in the U.S. by market value increased its staff in Chicago by 10 percent last year to more than 800 workers, and has explored development of a four-block area of downtown Minneapolis.
Wells Fargo Home Mortgage is one of the nation's top mortgage servicers, which accept and record mortgage payments, pay taxes and insurance, and handle the foreclosure process. As of Aug. 30, 2012, it was servicing 9.5 million loans with a combined value of $1.66 trillion, according to Fitch Ratings.
"As demand increases and decreases, we respond," said Wells Fargo Home Mortgage spokeswoman Vickee Adams.
(Source: USA Today, 02/12/13)