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Sharpen Your Pencils

She may not have a crystal ball, but Cara Heiden, division president of Wells Fargo Home Mortgage, spoke at the 2006 REAL Trends Gathering of Eagles about the four segments that she expects will drive homeownership in the coming years. Here’s what she had to share:

First-time homebuyers: This is a given, based on the sheer number of Americans who are making their way into the homebuying market for the first time.

Minority homebuyers: Ethnic buyers made up 30 percent of the overall market last year, says Heiden. “We must be located in ethnically diverse areas, and our products must match up [with the needs of this segment].” She notes that the way brokers and mortgage companies address the needs of this group will be key. “This is another huge opportunity for us to work together,” says Heiden. “With respect to the Hispanic segment, the key is to find the customer’s point of trust. Based on research, that point of trust is with the real estate sales associate.”

Low- to moderate-income buyers:  “We must have product innovation with higher loan-to-value ratios and aggressively push affordable housing,” says Heiden, citing a Parade of Homes–type program in Des Moines, Iowa, where the homes toured are affordable homes rather than high-end, luxury homes.

Non-prime segment:
  “There are 35 million people out there who we can work with to overcome their credit challenges,” says Heiden. “We must help these renters get creditworthy to buy a home.”