“It will be critical for lenders to implement new methods for reaching an evolving and diverse population with lending products that meet their needs.”
housing prices, negative home equity in minority neighborhoods and the inability to afford a down payment are a few of the barriers to increased minority homeownership. The Pew Research Center notes that the homeownership gap between blacks and whites has widened since 2004. African Americans and Hispanics have a harder time getting approved for conventional mortgages than whites and Asians do. When they are approved, they tend to pay higher interest rates, Pew said. Lenders have cited debt-to-income ratios and poor credit among the main reasons for denials. To be sure, there are many complicated socio-economic challenges that impact minority homeownership numbers that lenders cannot fix on their own. These may require political, legislative, regulatory or advocacy actions at the local, state and national levels. The nation’s foreclosure and financial crisis resulted in major declines in homeownership as well as a shift in how people view the rental market. Growing numbers see it as a preferred alternative to homeownership.
THE GOLDEN YEARS Lenders have a host of opportunities, along with some challenges, in reaching millennials and minorities as future borrowers, real estate investors, homebuyers or renters. But what about aging baby boomers? The generation that’s made an indelible impact on our nation is getting older, impacting everything from health care to Social Security to the labor force. While millennials are forming households, baby boomers are reaching ages in which they, or their loved ones, will be making decisions about downsizing, assisted living, nursing home care and the own-versus-rent decision. Because this generation is so large, it’s important for lenders to pay attention to trends, as they could have a long-lasting impact on the housing economy. Will most choose to age in place, or will they put their homes up for sale and become renters after retirement or as old age sets in? Will millennials wanting to transition to homeownership or investors anticipating continued demand
for single-family rental housing swoop and scoop up their homes? Or is there a risk of a supply glut if the trend moves to condos and apartment living? If housing—no matter the type, is to appeal to aging baby boomers, what must be done to attract them? Will homes or condos need wider doors and hallways for wheelchairs? Should yards be smaller and low maintenance? Should there be a neighborhood grocery store within walking distance?
TAKING ACTION
ABOUT THE AUTHOR
ROBERT GREENBERG Robert Greenberg joined
Patch of Land earlier this year as chief marketing officer.
His professional experience includes over 25 years in marketing, working with
familiar consumer brands such
as Pepsi-Cola, Anheuser-Busch and Sara Lee as well as B2B
experience in retail, technology, finance and real estate.
Recently, he led the marketing efforts for B2R Finance, where
he helped originate more than
As the market changes, private lenders must be nimble enough to change along with it. It will be critical for lenders to implement new methods for reaching an evolving and diverse population with lending products that meet their needs. They must also speak to savvy investors who understand how to capitalize on this changing landscape. Trends are quickly changing, and the outlook for housing growth will be robust in the coming years. Are private lenders ready? ∞
$1 billion of real estate investor loans that led to the industry’s first-ever multi-borrower sin-
gle-family rental securitization. At B2R, he was responsible for branding, corporate commu-
nications, lead generation and integrated marketing efforts.
He was responsible for leading the development and implementation of the marketing
automation and CRM platform that helped to deliver sales
management and operational efficiencies to enhance the
customer experience for real estate investors nationwide.
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