The COVID-19 pandemic has transformed certain aspects of the home buying market, according to the 2022 Borrower Insights Survey developed by ICE Mortgage Technology.
The survey of 2,000 Americans – 1,000 borrowers and 1,000 renters – reveals a changed society in which the pandemic has accelerated work and technology trends already underway. The survey was conducted in December 2021,
“What we’ve learned over the last two years is our lives will never go back to the way they were,” Joe Tyrrell, president of ICE Mortgage Technology, said. “Borrowers are more accustomed to ordering everything online from groceries to appliances to automobiles. It’s no surprise that when asked, they prefer to go virtual with home buying as well. As an industry, we need to continue to deploy digital offerings – but not at the expense of relationships, which are still an important factor in choosing a lender.”
The survey found that the “great resignation” seems to be driving the “great relocation.” Both borrowers and renters alike are willing to be on the move, looking for different or more rewarding work, or chasing available work. They are also looking for homes with more space, where they can work remotely.
Specifically, of the 28 percent who said their decision to sell was driven by a job change or relocation, 61 percent said the ability to work remotely is the main reason for their job change and/or relocation.
It also found that renters and borrowers are enthusiastic about the idea of an online mortgage process. Specifically, 74 percent of “pandemic era” borrowers (those who have gone through the mortgage process in the past two years) think an online mortgage process makes, or would make, buying a home easier than an in-person process. Three years ago, only 52 percent of borrowers were likely to use an online application or portal. Further, about 60% of borrowers said they were influenced in their choice of lender by whether the institution offered online mortgage applications or portals. This is up from 19 percent in 2017.
Also, about 46 percent said they were influenced by the lender’s mobile app. However, that number is much higher among younger borrowers as 61 percent of Millennials and 65 percent of Gen Z borrowers said mobile apps influenced their choice.
In addition, the survey found that borrowers were much more likely to choose a bank (31 percent) or a mortgage broker (25 percent) as their lender. They were less likely to use an online mortgage entity (13 percent), a credit union (13 percent), a savings and loan (8 percent), or a community bank (7 percent). Also, proving that relationships still matter, 68 percent found their most recent mortgage lender through some form of personal relationship.
ICE Mortgage Technology is part of Intercontinental Exchange, a leading global provider of data, technology, and market infrastructure.