Shaky ground: Strict regulation and continued deleveraging will limit industry growth

Prior to the subprime mortgage crisis, consumers in the United States funded their spending with credit cards, mortgage financing and home equity loans, causing aggregate household debt to rise. Amid heavy debt accumulation, banks and lenders increased their activity, which helped banks and lenders diversify risk and facilitate lending. Nevertheless, as the subprime mortgage crisis developed and defaults rose as a result of mounting interest rates, demand collapsed for mortgages and other debt securities on the secondary market. With lower income from mortgage interest, however, industry revenue is expected to fall over the five years to 2017, despite an improving economic landscape. The consequences of the subprime mortgage collapse will limit industry growth over the next five years...read more.

Industry Statistics & Market Size
Revenue
$364bn
Annual Growth 12-17
-1.9%
Forecast Growth 17-22
Profit
Employment
432,531
Businesses
47,113
Market Share of Companies
What Our Customers Say

Industry Threats & Opportunities

  • Strict regulation, rising interest rates and deleveraging will moderate demand and limit industry growth
  • Higher barriers to entry and regulation have contributed to further industry consolidation
  • House prices will stabilize, modestly driving up lending activity
  • Industry Report - Industry Investment Chapter

    The Real Estate Loans and Collateralized Debt industry operates with a low level of capital intensity. IBISWorld estimates that for every $1.00 spent on wages, the industry will allocate $0.06 in capital investment. This 2017 figure represents no real change from 2012. The industry provides loans to businesses, agencies and individuals by raising funds in the secondary market. Firms are able to perform these functions without relying on significant capital expenditure.Most capital expenditure for the industry is related to computers and technology used to process loans and maintain information. Investments in technology infrastructure, particularly delivering online services, have increased in recent years. Mos...purchase to read more.

    Additional Insights for the Real Estate Loans & Collateralized Debt Industry

    IBISWorld identifies 250 Key Success Factors for a business.The most important for the Real Estate Loans & Collateralized Debt Industry are

  • Superior financial management and debt management
  • Ability to raise revenue from additional sources
  • Membership of joint marketing/distribution operations
  • IBISWorld analysts also discuss how external factors such as Aggregate household debt and Homeownership rate in the Real Estate Loans & Collateralized Debt industry impact industry performance..

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    What is the Real Estate Loans & Collateralized Debt Industry?

    The industry comprises nondepository operators that specialize in lending activity. Unlike banks and other traditional lenders, industry participants do not rely on deposits to issue loans. Instead, nondepository operators provide lending services by selling securities, such as bonds, notes and stock or insurance policies, to the public. In addition to direct lending, industry operators also generate income by securitizing and selling mortgages and other loans on the secondary market.

    Industry Products
  • Secondary market financing
  • Real estate lending
  • Consumer lending
  • Short-term loans and credit lines
  • International trade financing
  • Industry Activities
  • Secondary market financing and securitization (i.e. MBSs and CDOs)
  • Providing real estate credit
  • Consumer lending and financing
  • Providing other nondepository credit intermediation (i.e. pawnshop operations)
  • International trade financing
  • Table of Contents

    Industry Definition
    Main Activities
    Similar Industries
    Additional Resources
    Industry Statistics Snapshot
    Industry Structure
    Executive Summary
    Executive Summary
    Key External Drivers
  • Aggregate household debt
  • Homeownership rate
  • House price index
  • year conventional mortgage rate

  • Current Performance
  • Mortgage crisis
  • Recent growth
  • Operational trends
  • Profit volatility
  • Chart: Revenue Growth

  • Industry Outlook
  • Industry pressures mount
  • Heightened government regulation
  • Table: Real Estate Loans & Collateralized Debt Industry Revenue Outlook

  • Industry Life Cycle
  • Life cycle reasons
  • Chart: Benchmarking - Real Estate Loans & Collateralized Debt Industry Lifecycle vs The Economy

  • Supply Chains
    Key Buying Industries
  • Mining
  • Construction
  • Commercial Banking
  • Savings Banks & Thrifts
  • Credit Unions

  • Key Selling Industries
  • Commercial Banking
  • Credit Unions
  • Loan Brokers
  • Savings Banks & Thrifts

  • Products & Services
  • Real estate lending
  • Secondary market financing
  • Short-term loans and credit lines
  • Consumer lending
  • International trade financing
  • Chart: Real Estate Loans & Collateralized Debt Industry Products and Services Segmentation

  • Demand Determinants
    Major Markets
  • Consumers (secured and unsecured loans)
  • Businesses (mortgages and trade financing)
  • Federal agencies
  • Depository institutions
  • Other (foreign central banks)
  • Life insurance companies
  • Chart: Major Market Segmentation for the Real Estate Loans & Collateralized Debt Industry

  • International Trade
    Business Locations
    Chart: Business Locations by State
    Market Share Concentration
    Key Success Factors
    Cost Structure Benchmarks
  • Profit
  • Interest expenses and provisions for credit losses
  • Wages and depreciation
  • Marketing
  • Other
  • Chart: Cost Structure Benchmarking – Sector vs Real Estate Loans & Collateralized Debt

  • Basis of Competition
  • Internal competition
  • External competition

  • Barriers to Entry
  • Table: Barrier to Entry Checklist for the Real Estate Loans & Collateralized Debt Industry

  • Industry Globalization
    Federal National Mortgage AssociationFederal Home Loan Mortgage Corporation
  • Table: Federal National Mortgage Association - financial performance
  • Table: Federal Home Loan Mortgage Corporation - financial performance

  • Capital Intensity
  • Chart: Level of Capital Intensity for the Real Estate Loans & Collateralized Debt Industry
  • Chart: Tools of the Trade: Growth Strategies for Success

  • Technology & Systems
    Revenue Volatility
  • Chart: Volatility vs Industry Growth

  • Regulation & Policy
    Industry Assistance
    Table: Industry Data for the Real Estate Loans & Collateralized Debt Industry
    Includes:
  • Industry Revenue (2008-2022)
  • Industry Gross Product (2008-2022)
  • Establishments (2008-2022)
  • Businesses (2008-2022)
  • Employment (2008-2022)
  • Wages (2008-2022)
  • Homeownership rate (2008-2022)

  • Table: Annual Percentage Change for Key Industry Data
    Table: Key Ratios for Industry Key Data
    Table: Industry Financial Ratios
    Adjustable-Rate Mortgages (Arms)
  • A type of mortgage in which the interest rate that is paid on the outstanding balance is variable.
  • Collateralized Debt Obligations
  • An investment-grade security backed by a number of bonds, loans and other assets.
  • Mortgage-Backed Securities
  • An asset-backed security or debt obligation that is secured by a mortgage or collection of mortgages.
  • Payday Loan
  • Short term loans that use the borrower's salary as security.
  • Prime Mortgage
  • The highest quality mortgage loan, given to borrowers that are considered to be the most credit-worthy.
  • Subprime Mortgage
  • A mortgage loan that is offered at a rate above prime to those who do not qualify for a prime rate loan.
  • Why buy this report?

    IBISWorld’s industry research report on Real Estate Loans & Collateralized Debt can be used to help you understand the industry’s market size, growth potential and major companies. Five-year forecasts provide insight into the industry’s prospects, so you can make decisions with confidence. This information is perfectly suited to informing your business plans, pitch books, benchmarking and SWOT analysis.

    IBISWorld industry market research reports enable you to:
    • Find out about key industry trends
    • Identify threats and opportunities
    • Inform your decisions for marketing, strategy and planning
    • Quickly build competitive intelligence
    This report on Real Estate Loans & Collateralized Debt:
    • Provides Market Size information to assist with planning and strategic decisions.
    • Includes the necessary information to perform SWOT, PEST and STEER analysis.
    • Helps you understand market dynamics to give you a deeper understanding of industry competition and the supply chain.
    • Analyses key performance and operational metrics so that you can benchmark against your own business, that of your customers’ businesses, or your competitors’ businesses.
    The Real Estate Loans & Collateralized Debt market research report includes:
    • Historical data and analysis for the key drivers of this industry
    • A five-year forecast of the market and noted trends
    • Detailed research and segmentation for the main products and markets
    • An assessment of the competitive landscape and market shares for major companies
    • And of course, much more

    IBISWorld reports on thousands of industries around the world. Our clients rely on our information and data to stay up-to-date on industry trends across all industries. With this IBISWorld Industry Research Report on Real Estate Loans & Collateralized Debt, you can expect thoroughly researched, reliable and current information that will help you to make faster, better business decisions.

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