Hot Spots to Watch in 2025
Collin County is home to several rapidly growing communities. Here are a few areas gaining traction in 2025: McKinney: Known for its historic downtown and family-friendly vibe, McKinney is one of the most sought-after cities in Collin County. Frisco: With its booming economy, excellent schools, and The Star development, Frisco continues to attract both families and businesses. Celina: Emerging as a hub for new developments, Celina offers more affordable options while still providing easy access to major highways. Allen: From its thriving retail centers to top-rated schools, Allen remains a popular choice for families and young professionals alike.
Housing Market Sees Surge of ‘Wait-and-See’ Home Buyers
Last month, contract signings fell to their lowest level on record as the housing market continued to struggle through a sluggish summer. According to the National Association of REALTORS®’ latest Pending Home Sales Index—a forward-looking measure based on contract signings—there was a 5.5% decline in July and an 8.5% drop compared to the previous year. Lawrence Yun, NAR’s chief economist, commented, “A sales rebound did not materialize in midsummer. Despite job growth and increased inventory, these factors were insufficient to overcome affordability issues and some degree of hesitation related to the upcoming U.S. presidential election.” Some potential home buyers might also be holding out for a decrease in mortgage rates. Federal Reserve Chair Jerome Powell recently indicated that “the time has come for policy to adjust,” suggesting a likely interest rate cut at the Fed’s mid-September meeting. Although the Fed’s rate does not directly set mortgage rates, it can influence them, though the extent is debatable among economists. Home buyers might choose to wait until fall to see if any potential rate cuts could enhance housing affordability. Nirvan Ghosh, portfolio manager at The Palisades Group, predicts that the Fed could implement at least four rate cuts by the end of the year, which might lower mortgage rates from their current mid-6% averages. Additionally, buyers could have more options as inventory levels increased by 20% in July compared to a year ago, according to NAR. Ghosh notes, “We expect that any decrease in mortgage rates will continue to put upward pressure on housing prices due to pent-up demand from prospective buyers, likely outweighing any increase in supply.”
UWM's Zero-Down Loans Gain Buyer Favor but Raise Concerns Among Consumer Advocates
UWM's zero-down loan initiative garners buyer interest but raises concerns among consumer advocates. In contrast to the lax underwriting standards of subprime loans prior to the 2007 housing crash, these new loans adhere to strict criteria set by Freddie Mac. According to CNN, United Wholesale Mortgage (UWM) introduced its "0% Down Purchase" program last month, proving popular among homebuyers. However, some consumer advocates fear that borrowers could quickly find themselves owing more than their homes are worth if property values decline. Under this program, borrowers earning less than 80 percent of the area median income can secure a Freddie Mac Home Possible loan covering 97 percent of the home's value, with UWM providing a second mortgage for the remaining 3 percent, capped at $15,000. Although the second loan accrues no interest and requires no monthly payments, repayment is mandatory upon home sale or refinancing. UWM CEO Mat Ishbia hailed the program's potential to revolutionize home purchasing, highlighting its removal of the downpayment obstacle for thousands of prospective buyers. However, critics caution that borrowers with minimal equity are at greater risk of foreclosure if forced to sell prematurely. Better Markets CEO Dennis Kelleher likened these loans to "ticking time bombs" akin to subprime mortgages. Despite objections from UWM, comparisons to subprime lending persist. Nevertheless, unlike pre-crash subprime loans, UWM's zero-down loans must meet stringent Freddie Mac standards. Similar low-down payment programs exist, such as Freddie Mac's Home Possible and Fannie Mae's Home Ready initiatives, allowing borrowers to put down as little as 3 percent. UWM, Rocket Mortgage, and Zillow have expanded accessibility by offering grants to eligible borrowers, reducing the required down payment to as little as 1 percent. Demand for these zero-down loans has been substantial, with UWM already processing thousands of loan applications, according to Alex Elezaj, UWM's chief strategy officer. Additionally, various down payment assistance programs and Special Purpose Credit Programs (SPCPs) aim to assist underserved borrowers in securing homeownership. Bank of America, for example, offers a zero down payment, zero closing cost mortgage for first-time homebuyers in designated markets as part of its Community Homeownership Commitment.
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