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New HomeLight data on lender recession fears, stalled deals, and buydowns

Written by Posted On Sunday, 18 May 2025 08:41

HomeLight’s Q2 2025 Lender Insights & Predictions Report launches today, revealing how loan officers are navigating economic uncertainty (recession and tariff fears), clogged pipelines, and shifting buyer behavior amid persistent high rates. 

Key findings include:

  • Recession worries:63% of loan officers say the U.S. is headed for a recession; 57% expect borrowers will delay home searches as a result.
  • Mortgage rate buydowns on the rise:58% of lenders are seeing increased demand for buydowns, with 2-1 buydowns overwhelmingly popular among buyers looking to soften initial costs.
  • Seller concessions climb:21% of loan officers are seeing more sellers covering buyer costs (agent fees, closing costs) to keep transactions on track.
  • Pipeline congestion:50% of lenders report more deals being canceled, pinned largely on inspection findings, financing challenges, and buyer hesitation.
  • Tariffs raise alarms:Loan officers worry new tariffs will spike construction costs, further constraining affordability.
  • Buyers urged to act:Lenders predict that if interest rates drop to an actionable level, prices could spike by an estimated 16%, and are urging clients to move sooner rather than later, warning of price spikes if rates drop. 
  • Market unlock rate: 36% of loan officers say that buyers and sellers hope interest rates will drop to at least 5.75% before making a move.

The full report is here 

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