Without audience targeting are Google Ads Dead? Think again…
Early this month Google announced new restrictions for targeting specific audiences. The restrictions apply to content related to housing, employment, credit, and those who are disproportionately affected by societal biases. The news of these restrictions created quite a stir among industry brokers and lenders who heavily rely upon targeted Google ad campaigns. All which may have you asking if these changes will kill future reverse mortgage advertising on the world’s most popular search engine. In just a moment we’ll hear from our online SEO expert Josh Johnson to find out.
Google’s restrictions are not necessarily novel nor unexpected. It was just over two years ago Facebook faced scrutiny from federal regulators for allowing those offering credit or housing finance to restrict ad audiences by race or religion among other questionable metrics that would violate HUD’s fair housing rules. An investigation by ProPublica broke this news in October 2016. It was nearly two years later in August 2018 that HUD filed a formal complaint against the social media giant for discriminatory advertising practices. Seven months after HUD’s complaint Facebook announced sweeping changes. Both Facebook and later Google, took a blunt approach much to the chagrin of lenders and service providers.
What ad filters are going away? In its official release Google revealed, “credit products or services can no longer be targeted to audiences based on gender, age, parental status, marital status, or ZIP code.”
Is this the end of Google ads for reverse mortgages? To answer that question I reached out to Josh Johnson who heads up Reverse Focus’ Online Dominance SEO program and Google marketing. Here’s his explanation.
Here’s what makes Google unique from other platforms and why reverse mortgage Google ads will continue to reach the intended audience.
To summarize, older homeowners are intentionally seeking out reverse mortgage information on Google which means, yes-your ads will be seen by your target audience, even though you can no longer target specific age groups.
Is there cause for measured optimism in 2021 & beyond?
Will an economic hangover following the COVID-19 pandemic leave the U.S. economy and housing market be short-lived or have us reaching for a heavy dose of Tylenol? Economists and housing experts’ opinions fall between prognostications of doom and gloom and sunny optimism. However, outside these two extremes lies some interesting details reverse mortgage professionals may want to keep in mind.
A February 8th headline in Housing Wire asks “The last stand for forbearance housing market crash bros?” Just as some who contracted COVID-19 continue to have ongoing health problems in the wake of the infection, our economy remains vulnerable to a glut, 2.72 million to be precise, of mortgages currently in forbearance. The vexing question is how will those loans in arrears be unwound in such a way as to not damage a fragile economy? However, data reveals that the unraveling of these problematic loans may be less onerous. The volume of those seeking forbearance has dropped significantly according to a report from Black Knight.
Another scenario is the U.S. government will continue to move the goalposts for mortgage forbearances, a strategy that has been employed repeatedly in recent months.
Then there’s the underlying quality of homeowner’s credit of those who are in forbearance.
Housing Wire columnist Logan Mohtashami writes, “this is critical to the story, homeowners’ credit profiles, when they originated their loans, were excellent. The previous expansion had the best loan profiles I have seen in my life. These buyers, especially those who purchased from 2010-2017, have fixed low debt costs due to low mortgage rates, with rising wages and nested equity.”
Granted in the wake of the housing crash of 2008 improved lending standards have reduced the prevalence of over-leveraged borrowers. However, that may inconsequential for those who lost their jobs and remain unemployed. It would seem that unwinding loans in forbearance will depend upon job recovery rates and falling unemployment claims.
Is the specter of inflation looming ahead? The insurance giant ING says the only way inflation can go is up! “Headline US inflation has risen from 0.2% YoY last May to 1.4% today and is likely to sail well above 3% in coming months. The Fed have said they will “look through” a temporary spike, but there is a growing sense that inflation could be stickier, potentially forcing them into earlier action on interest rates than they are currently signaling.” Put simply while the Fed is pumping the economy with trillions of dollars there are limits to such measure should inflation begin to spike too quickly. Such considerations leave one to wonder if the Fed is too sanguine in signaling no significant interest rate hikes in the coming year or two.
And speaking of sanguine, Goldman Sachs has boosted their prediction of the U.S. economy’s GDP to a staggering 6.8%. Such unheard-of GDP numbers may appear dubious, but keep in mind that as more Americans are vaccinated and return to work the bounce back from an economy that nearly pancaked may not be quite so far-fetched after all. “Economists at the bank raised their forecast for 2021 US gross-domestic-product growth to 6.8% from 6.6% and to 4.5% from 4.3% in 2022”, reads the Business Insider column. The investment bank expects the Federal Reserve will not increase interest rates until the first half of 2024 in light of their upgraded GDP forecast and improved unemployment figures.
All things considered, despite the COVID-19 pandemic and economic uncertainty housing prices are expected to remain stable, inflation remains an economic wildcard in the recovery effort, and the economy is poised to post record growth after a historic contraction. Each of these factors individually and collectively bode well for modest or even significant growth of the reverse mortgage market.
Additional Reading | Sources cited:
Business Insider: Goldman Sachs boosts US GDP forecast to 6.8% in 2021