San Jose Market Too Hot for Mortgage Growth
A very hot real estate market is hampering a San Jose credit union's ability to make new housing loans.
Daniel Hapner, director of mortgage sales for the 83,000 member, $1 billion Meriwest Credit Union, reported that a shortage of homes for sale has slowed the credit union's ability to make new mortgage loans.
“We have a real inventory problem here,” Hapner said.
Situated in one of the country's hottest real estate markets, San Jose, Calif., Hapner reported that increased interest rates have largely slowed the market.
Hapner explained higher interest rates have meant that existing home owners have been slow to sell their current homes, which are locked in to low-rate loans with low payments. That, in turn, slowed demand for new mortgage loans.
In addition, he reported that San Jose's very low unemployment rate and relatively strong economy have made the inventory shortage even worse.
“We have many new people moving here and those folks need to buy homes, but there aren't many available,” he said.
The desire to buy is there, Hapner said, adding up to 100 families attend home buying events sponsored by the credit union.
“But many of those people will not be able to find homes they can buy,” he said.
Local media outlets have reported that, on average, a home remains for sale in the San Jose market for only 9 days.