In May 2025, Anchor Loans CEO Ray Mathoda joined a panel of housing leaders at the John Burns Housing Summit in Orange County, CA, a high-impact gathering of national builders, build-to-rent (BTR) developers, SFR operators, suppliers, and financiers. Her panel discussion focused on the emerging role of non-traditional capital in today’s housing finance ecosystem.
As the market recalibrates, Ray offered a grounded perspective: the fundamentals remain strong, but developers must adapt. Here’s a look at the key insights Ray shared and what they mean for builders and investors charting a course through this dynamic environment.
Supply Shortfall, Regional Divergence, and a Lukewarm Spring
The national housing shortfall remains substantial, with Freddie Mac estimating a gap of 3 to 4 million units. Yet the supply story varies sharply by region. Ray highlighted key market trends:
- Inventory is rising in Sun Belt metros like Austin and Denver
- Supply remains tight in the Northeast, Midwest, and legacy markets like Buffalo, NY
April and May brought muted traffic for many builders. The anticipated “spring bounce” fell flat, weighed down by persistent affordability pressures and uncertainty around rate movement. While the industry hoped for Fed rate cuts, interest rates have instead moved upward since “Liberation Day,” increasing monthly payments and dampening first-time buyer activity.
Key Headwinds Facing Builders
Ray outlined three macro challenges developers must keep top of mind:
1. Rising Interest Rates
Higher borrowing costs are squeezing affordability, particularly for entry-level buyers. This shift is prompting developers to reassess product design, pricing strategies, and location focus.
2. Input Cost Volatility
Tariffs initially sparked fears of a 5% to 7% jump in material costs, but updated forecasts suggest inflation closer to 2%. Many builders are adapting with supplier diversification and more direct procurement strategies.
3. Labor Market Uncertainty
Labor shortages haven’t hit yet, but developers remain cautious. Shifting immigration policy and visa renewals pose risk, though falling multifamily starts have helped ease pressure by redirecting labor into the single-family sector.
Buyer Landscape: A Tale of Two Segments
While affordability has sidelined many first-time buyers, move-up buyers and 55+ consumers remain resilient.
- First-Time Buyers are challenged by higher rates and larger down payments
- Move-Up and 55+ Buyers often come with built-in equity and require less leverage, making them more rate-resistant
This demographic divide is shaping product decisions. Builders are leaning into flexibility, designing communities and home types that meet the needs of today’s active buyer segments while keeping options open for a market rebound.
Developer Strategy: Flexibility Over Frenzy
Even amid softer demand, builders remain fundamentally optimistic but cautious. Developers are fine-tuning their starts rather than hitting the brakes:
- Most are moderating production, not stopping it
- The goal is to preserve optionality and maintain operational agility through continued market volatility
Margins remain under pressure, but the long-term demand drivers are intact, especially for for-sale housing, rental communities, and build-to-rent neighborhoods.
Financing’s Next Chapter: The Rise of Non-Traditional Credit
As traditional banks reduce exposure to real estate lending, private capital is filling the void. Ray emphasized that this shift isn’t just transactional, it’s strategic.
“We are facing some near-term road bumps. They’re not catastrophic, but they require us to rethink how we operate, what we build, and who we serve,” she shared.
Private lenders like Anchor Loans are enabling smarter, faster capital deployment. At the panel alongside CoreVest CEO Beth O’Brien and Kiavi’s Arvin Dastoor, Ray highlighted the evolving role of collaboration across non-bank lenders.
Rather than pure competitors, these platforms are forming a broader, more resilient finance network for residential developers. The result is greater access, more customization, and a deeper understanding of construction-specific lending needs.
A Market in Motion and a Future Built Together
Despite near-term uncertainty, the residential real estate industry isn’t retreating, it’s evolving. Developers are building smarter. Investors are diversifying. And financing partners are innovating alongside them.
As Ray concluded:
“Everyone felt optimistic about the long-term dynamics in the real estate and housing finance markets. There’s a big shift happening, but none of us can do it alone. There’s huge opportunity for collaboration even as we compete.”
At Anchor Loans, we’re proud to stand beside the builders, developers, and investors shaping the future of housing, ready to provide the capital, confidence, and clarity needed to move forward.
