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In 2024, the housing market defied recession fears, with mortgage and home equity growth driven by briefly lower interest rates, strong equity positions, generally positive economic indicators, and stock market appreciation. This performance is notable because, in 2023, economists’ favorite hobby was predicting a recession in 2024. Following a period of elevated inflation, driven largely by loose monetary policy, expansionary fiscal policy, and supply chain disruptions brought on by COVID, economists were certain that the US economy would shrink. However, the economy continued outperforming expectations, even as unemployment rose modestly (Figure 2) and inflation cooled (Figure 3). Source: FRED (Figure 1, Figure 2, Figure 3). So, a good economy is good for the mortgage and home equity markets, right? Generally speaking, this statement was true. As monitored by Experian’s credit database, mortgage originations increased by approximately thirty percent year over year as of November 2024 (Figure 4), and Q3 ’24 pre-tax profit for Independent Mortgage Banks (IMBs) averaged $701 per loan.1 So, business in home lending is good — certainly better than it was during the period when the Fed was raising rates, origination volumes shrank as opposed to grew, and IMB profit per loan turned negative. Source: Experian Ascend Insights Dashboard. What constituted this growth in mortgage lending? As we all know, the Fed has lowered interest rates by 100bps since they started reducing rates in September. The market had priced in the September cut weeks prior to the actual announcement (Figure 5), and the market enjoyed a spike in refinance volume as a result (Figure 6). However, in the lead-up to and following the US presidential election, interest rates spiked back up due to the market’s expectations around future economic activity, which will dampen pressure on refinance volumes even after the recent additional rate drop. The impact of further rate drops on mortgage rates is unclear, and refinance volume still constitutes only around three percent of overall origination volume. Source: Figure 5, Figure 6 (Experian Ascend Insights Dashboard). The shift to a purchase-driven housing market What does this all mean? Our view is that pockets of refinance volume (rate and term, VA, FHA, cashout) are available to those lenders with a sophisticated targeting strategy. However, the data also very clearly indicates that this market is still very much a purchase market in terms of opportunity for originations growth. This position should not surprise long-time mortgage lenders, given that purchase volume has always constituted a significant majority of origination volume. However, this market is a different purchase market than lenders may be used to. This purchase market is different because of unprecedented statistics about the housing market itself. The average age of a first-time homebuyer recently reached a record high of 38. The average age of overall homebuyers in November of this year similarly jumped to a new record high of 56, with homes being “wildly unaffordable for young people.” Twenty-six percent of home purchases are all-cash, another record high, and homeowners have an aggregate net equity position of $17.6 trillion, fueling those all-cash purchases. The market is expensive both from an interest rate perspective and a housing price-level perspective, and those trends are driving who is buying homes and how they are buying them.2 Opportunities for lenders in 2025 What do these housing market dynamics mean for lenders? To begin with, lenders should not spend money marketing mortgages to consumers in their 50s and 60s with large equity positions. These consumers are likely to be in the 26 percent all-cash buyer cohort, and that money will be wasted since mortgages are no longer so cheap that even cash-rich buyers would take them. Further, this equity-rich generation has children, and nearly 40% of those children borrow from the bank of mom and dad to purchase their first home. Since roughly a quarter (albeit a shrinking quarter) of homebuyers are first-time homebuyers, and since 40% of those rely on help from parents to facilitate that purchase, it may make sense for lenders to identify those consumers with 1) children and 2) significant equity positions and to offer products like cash-out refinances or home equity loans/lines to help facilitate those first-time purchases. Data is critical to executing these kinds of novel marketing strategies. It is one thing to develop these marketing and growth strategies in principle and another entirely to efficiently find the consumers that meet the criteria and give them a compelling offer. Consider home equity originations. As Figure 7 illustrates, HELOC originations are strong but have completely stalled from a growth rate perspective. As Figure 8 illustrates, this is despite the market's continued growth in direct mail marketing investment. Although HELOC origination volumes are a fraction of mortgage—around $27b per month for HELOC versus $182b per month for mortgage—there are significantly more home equity direct mail offers being sent per month (39 million) for home equity products as there are for mortgage (31 million) as of October ’24.3 This all means that although many lenders have wised up to the home equity opportunity to the point of saturating the market with offers, few have successfully leveraged targeting data and analytics to craft sufficiently compelling offers to those consumers to convert those marketing leads into booked loans. Source: Figure 7 (Experian Ascend Insights Dashboard), Figure 8 (Mintel). Adapting to a resilient housing market In summary, the housing market, comprised of mortgage and home equity products, has experienced persistent growth over the past year. Many who are reading this note will have benefitted from that growth. However, as we have identified, in many respects housing market growth has 1) been concentrated to some key borrower demographics and 2) many lenders are investing in marketing campaigns that are not efficiently reaching or convincing that key housing demographic to book loans, whether it be a home equity or mortgage product. As such, as we move into 2025, Experian advises our clients to focus on the following three themes to ensure they benefit from this trend of growth into the new year: Ensure you effectively differentiate your marketing targeting, collateral, and offers for the various demographics in the market. Ensure your origination experiences for mortgage and home equity products are modern and efficient. Lenders who force all borrowers through a painful, manual legacy process will waste marketing dollars and experience pipeline fallout. Although the market is growing, other lenders are coming for your current customers. They could be coming for purchase activity, refinance opportunities, or they may be using home equity products to encroach on your existing mortgage relationship. As such, capitalizing on growth in 2025 is not merely about gaining new customers; it is also about retaining your existing book of business using high-quality data and analytics. Learn more 1 Although December numbers are available for year-over-year comparison, we excluded them due to the holiday period's strong seasonality patterns. 2 The Case-Shiller index recently topped out at record levels. 3 Mintel/Comperemedia data.

Transformations in today’s U.S. rental market reflect changing economic and market forces. These dynamic times present challenges and opportunities for property managers and landlords seeking more stability and consistency in their property occupancies. The real estate industry responded positively to the Federal Reserve's recent announcement to cut interest rates by a quarter percentage point, marking a favorable shift from previous actions that kept rates steady. However, uncertainty lingers about the extent and pace of changes in the residential real estate market, including the rental and buying sectors. Experts remain optimistic, predicting improvements as the market heads into next year's busy season. Landlords and property managers looking to attract more stable renters need to understand macro- and micro-market trends, renter demographics and preferences, and other information impacting their specific locales. Experian Housing published its 2024 report on the U.S. rental market, which provides data-driven insights into the current rental landscape. Experts examined today’s renter population, current market trends, the state of housing development, and the market’s future. Who is today’s renter? Today’s renter is still navigating financial constraints and potential marketplace affordability challenges. While location-specific information does influence the affordability of renting versus buying a home, on average, affordability remains an important factor guiding consumer decision-making. Our latest rental report highlights a notable shift in the rental market, with a growing number of younger renters and a decline in the average annual income among renters. According to Experian’s RentBureau®1, over 30% of renters are Generation Z—the youngest adult demographic. Expanding this to include individuals under 34 years old, younger renters now represent over half of all renters in the United States. Experian’s research highlights a shift in rental spending trends, showing the average income for renters now at $52,600. RentBureau data underscores the evolving financial landscape, with rent-to-income (RTI) ratios reflecting a growing commitment to housing. On average, individuals allocate 44.1% of their income to rent, while low-to-moderate-income households dedicate 52.5%. These figures exceed the traditional guideline of keeping rent within 30% of gross monthly income, underscoring the significant economic pressures faced by renters, particularly those with low-to-moderate incomes, as they navigate rising housing costs and limited affordability in the current market. This reality highlights the urgent need for broader systemic solutions to address housing availability and affordability challenges. What is happening in the rental market? Rental market trends reflect several factors, including changes in renter demographics, interest rates, housing supply and demand, and the economy. Overall, vacancy rates have stayed relatively low, which has resulted in rising rent prices, although there are signs of flattening. With fewer housing options available, many renters stay put for longer, which also contributes to availability and affordability. More renters, over 50% of all renters (a 10% increase over May 2023), are paying $1,500 or more in monthly rent, and the nationwide average rent stands at $1,713. A regional look offers greater specific insights for landlords and property managers, which is critical for truly understanding the marketplace. In 2024, 43 of 50 states have RTI ratios above the suggested guideline of 30%. California has the highest median RTI at just over 46%, followed by Massachusetts, Florida, Washington, and New Jersey. Other states facing increasing RTI ratios include Georgia, North Carolina, Colorado, Texas, and Nevada. These high ratios negatively affect affordability. At the same time, Experian Housing research indicates that over 92% of renters hold a single lease over two years. Data also shows 6.7% of renters with two leases in 24 months and others moving three or more times in this timeframe. Older generations, surprisingly, are moving more now than in recent years. Where is development headed? High mortgage rates are constraining housing development, especially for affordable entry-level homes. Roughly 50% fewer starter homes are being built, and multifamily new construction also faces constraints. With that said, multi-family housing units already under construction are coming to market. These units are generally high-end, contributing to increased rental prices. The supply coming to the market is higher-priced due to greater construction costs across the board. Contributors to the rising costs include builds in pricier metropolitan areas as well as features and modern amenities sought after by younger renters. The U.S. Census Bureau reports a slight uptick in new home construction since July 2023. How is the future looking? The U.S. economy is expected to remain stable, which should benefit renters and landlords alike. The outlook for the rental market in 2024 and 2025 remains optimistic with inflation down and the Fed rate cut, but many other factors come into play, specifically, overall economic health and the state of the employment market. For renters, the best tact is to set goals to improve their overall credit profiles and opportunities in the housing market. Individuals benefit from rent reporting. Experian RentBureau helps renters build credit profiles and open the best opportunities for the rental market and moving to the first-time homebuyer market. With rental housing still in high demand, property managers and landlords should focus on tenant screening, rent reporting, and fraud prevention as part of their risk management strategies. Focusing on these areas will increase the chances of finding quality, longer-term tenants. To learn more about the state of the U.S. rental market, download Experian Housing’s 2024 rental report. Access report 1 RentBureau® is the largest rental payment database that contains more than 36 million renter profiles. While RentBureau doesn’t represent the total U.S. rental market population, internal studies reveal RentBureau data aligns closely to historical U.S. Census data studies, which provides confidence in the deeper understandings aggregated in the report.

In today’s digital landscape, where data breaches and cyberattacks are rampant, businesses face increasing security challenges. One of the most prevalent threats is credential stuffing—a cyberattack in which malicious actors use stolen username and password combinations to gain unauthorized access to user accounts. As more personal and financial data gets leaked or sold on the dark web, these attacks become more sophisticated, and the consequences for businesses and consumers alike can be devastating.But there are ways to proactively fight credential stuffing attacks and protect your organization and customers. Solutions like our identity protection services and behavioral analytics capabilities powered by NeuroID, a part of Experian, are helping businesses prevent fraud and ensure a safer user experience. What is credential stuffing? Credential stuffing is based on the simple premise that many people reuse the same login credentials across multiple sites and platforms. Once cybercriminals can access a data breach, they can try these stolen usernames and passwords across many other sites, hoping that users have reused the same credentials elsewhere. This form of attack is highly automated, leveraging botnets to test vast numbers of combinations in a short amount of time. If an attacker succeeds, they can steal sensitive information, access financial accounts, or carry out fraudulent activities. While these attacks are not new, they have become more effective with the proliferation of stolen data from breaches and the increased use of automated tools. Traditional security methods—such as requiring complex passwords or multi-factor authentication (MFA)—are useful but not enough to prevent credential stuffing fully. How we can help protect against credential stuffing We offer comprehensive fraud prevention tools and multi-factor authentication solutions to help you identify and mitigate credential stuffing threats. We use advanced identity verification and fraud detection technology to help businesses assess and authenticate user identities in real-time. Our platform integrates with existing authentication and risk management solutions to provide layered protection against credential stuffing, phishing attacks, and other forms of identity-based fraud. Another key element in our offering is behavioral analytics, which goes beyond traditional methods of fraud detection by focusing on users' data entry patterns and interactions. NeuroID and Experian partner to combat credential stuffing We recently acquired NeuroID, a company specializing in behavioral analytics for fraud detection, to take the Experian digital identity and fraud platform to the next level.  Advanced behavioral analytics is a game-changer for preventing credential-stuffing attacks. While biometrics track characteristics, behavioral analytics track distinct actions. For example, with behavioral analytics, every time a person inputs information, clicks in a box, edits a field, and even hovers over something before clicking on it or adding the information to it, those actions are tracked. However, unlike biometrics, this data isn’t used to connect to a single identity. Instead, it’s information businesses can use to learn more about the experience and the intentions of someone on the site. NeuroID and Experian’s paired fraud detection capabilities offer several distinct advantages in preventing credential stuffing attacks: Real-time threat detection: Analyze thousands of behavioral signals in real-time to detect user behavior that suggests bots, fraud rings, credential stuffing attempts, or any number of other cybercriminal attack strategies.  Fraud risk scoring: Based on behavioral patterns, assign a fraud risk score to each user session. High-risk sessions can trigger additional authentication steps, such as CAPTCHA or step-up authentication, helping to stop credential stuffing before it occurs. Invisible to the user: Unlike traditional authentication methods, behavioral analytics work seamlessly in the background. Users do not need to take extra steps—such as answering additional security questions or entering one-time passwords. Adaptive and self-learning: As users interact with your website or app, our system continuously adapts to their unique behavior patterns. Over time, the system becomes even more effective at distinguishing between legitimate and malicious users without collecting any personally identifiable information (PII). Why behavioral data is critical in combating credential stuffing Credential stuffing attacks rely on the ability to mimic legitimate login attempts using stolen credentials. Behavioral analytics, however, can spot the subtle differences between human and bot behavior, even if the attacker has the correct credentials. By integrating behavioral analytics, you can: Prevent automated attacks: Bots often interact with websites in unnatural ways—speeding through form fields, using erratic mouse movements, or attempting logins from unusual or spoofed geographic locations. Behavioral analytics can flag these behaviors before an account is compromised. Detect account takeovers early: If a legitimate user’s account is taken over, behavioral analytics can detect the change in interactions. By monitoring behavior, businesses can detect account takeover attempts much earlier than traditional methods. Lower false positive rates: Traditional fraud prevention tools often rely on rigid rule-based systems that can block legitimate users, especially if their login patterns slightly differ from the norm. On the other hand, behavioral analytics analyzes a user's real-time behavioral data without relying on traditional static data such as passwords or personal information. This minimizes unnecessary flags on legitimate customers (while still detecting suspicious activity). Improve customer experience: Since behavioral analytics is invisible to users and requires no extra friction (like answering security questions), the login and transaction verification process is much smoother. Customers are not inconvenienced, and businesses can reduce the risk of fraud without annoying their users. The future of credential stuffing prevention Credential stuffing is a growing threat in today’s interconnected world, but with the right solutions, businesses can significantly reduce the risk of these attacks. By integrating our fraud prevention technologies and behavioral analytics capabilities, you can stay ahead of the curve in securing user identities and preventing unauthorized access. The key benefits of combining traditional identity verification methods with behavioral analytics are higher detection rates, reduced friction for legitimate users, and an enhanced user experience overall. In an era of increasingly sophisticated cybercrime, using data-driven behavioral insights to detect user riskiness is no longer just a luxury—it’s a necessity. Learn more Watch webinar