Tools to close the gap
Lenders are looking for ways to get buyers moving again, Hepp said. She pointed to two tools in particular.
“For a long time we’re talking about builders giving rate buydowns,” Hepp said. “Now, even on existing home sales, I’m hearing about rate buydowns. So, for folks that can afford that, that’s an option. ARMs are on the up again. So, people are being creative.”
Optimal Blue’s September report bears that out for ARMs, which reached 14% of lock volume, the highest share in its data going back to 2019, up from 10.5% in August after hovering between 8% and 12% for some time.
Buyers and sellers are both hesitating, she said. She hopes tools like these get activity started.
“When you have such a loss of confidence on both ends, nothing happens,” Hepp said. “If something starts moving, more things start moving. So if we could just see maybe buyers saying, ‘Hey, it’s as good a time as any. Let me try with an ARM or let me try this alternative buydown.’”
