Top Florida Home Loan Officer Peers Into Future of the Housing Market
Five years.
That’s how long the Sunshine State enjoyed red hot, strong sales for. It also represents the amount of time Penny Hill has been ranked as the number-one loan offer for Chase in the United States.
The Florida home loan lender was raised in Sarasota, heads the Penny Hill Group and has led a $145 billion industry for half a decade now; she consistently beats out 2,100 other Chase professionals in 300 offices across the nation.
Hill (pictured) recent sat down with The Herald Tribune for an interview about the state of the Sarasota housing market and other insider issues …
Q: It seems the Realtors are expecting business this year to be off by about a third, but even so, they are expecting one of the top years ever. What are you seeing?
A: I have seen recent signs of a strengthening market in Sarasota, particularly in the single-family home arena. This is a typical dynamic in the summer season. Overall this year, we are seeing higher dollar amount sales but the number of units sold have decreased somewhat. Values in general appear stable, but marketing time has increased.
As we look into the future, Florida in general and Sarasota in particular will continue to be a very healthy real estate market. The economic heart and soul of real estate depends on more demand than supply, and an economic environment which makes real estate affordable for the consumer.
Florida will continue to benefit from significant migration into the state, particularly the baby boomer demographic. Currently, Florida is the recipient of 1,000 new residents each day. Economically, unemployment is low, average household incomes are up, interest rates remain historically low and inflation appears to be in control. All of this bodes extremely well for the future of real estate in Sarasota and Florida.
Q: Interest rates have been creeping up all year and many knowledgeable parties, including the National Association of Realtors, predict rate rises to continue into 2007. What’s your view?
A: I believe we should be done with interest rate increases (by the Fed) for the foreseeable future by the end of this year.
Although short-term rates have risen, long-term interest rates, (although higher than last year) are still historically very low. The [Florida home loan refinance] market has decreased to some extent because of the rate increases. However, many clients are refinancing from mortgages tied to short-term rates to a longer-term program (10-year ARM’s and 30-year fixed). An increasing number of consumers are attracted to interest-only mortgages to offset higher rates and to significantly lower the monthly payments.
Q: Do you expect a “thinning of the herd” in your industry?
A: Yes I do. Certain lenders who have focused on the refinance business may be more inclined to consolidate to achieve cost efficiencies or they will likely downsize or fail. It is also inevitable that inexperienced mortgage originators are “weeded out” when the market becomes more competitive. This results in a positive experience for those seeking [Florida home loans].
Q: Since bigger seems to be better in mortgage lending, can you tell us if Chase is interested in buying National City Corp.’s First Franklin Financial Corp., a San Jose, Calif.-based sub-prime lender with 33 wholesale mortgage branches, that is currently being marketed for sale?
A: As you well know, as an employee of a publicly traded company, I cannot comment on Chase’s future including any potential acquisitions, nor in my position would I have any real knowledge.
As an experienced mortgage banker, it is my belief that an opportunity for the future for Chase would be broadening the retail bank branches. It is my judgment that we already have substantial strength in the sub-prime arena.
Hill sees this being another year on top for her firm. There’s little reason to doubt her. If anyone is familiar with the pulse of Florida home loan buyers and the local market, it’s this expert.
