What's Up Real Estate - January
I hope you all had a joyous holiday season and are recharged for an exciting year ahead. As we approach the spring/summer selling season, there are plenty of reasons to be optimistic about the real estate market. 🏡💫 📉 Mortgage Rates and Market Dynamics: Let's start with the good news – since October last year, mortgage rates have seen a decline of just over 100 basis points. This shift, along with the likelihood of the Fed beginning to cut short-term rates in the coming months, is a positive sign. While home inventory is showing signs of improvement, it's noteworthy that home sales dipped by 1% MoM in December. Despite the easing in rates and an uptick in inventory, the annualized rate of home sales stood at 3.78 million units – a figure that raises some questions. Are we on the cusp of a market shift? It's a point to ponder, especially considering that 2023's total home sales were the lowest since 1995. 🔍 Real Estate Market Cycle Insights: As we analyze the cycle, questions arise: Are we seeing a price adjustment? Is this the best time for buyers to enter the market? With all 10 of Zillow’s top housing markets for 2024 located east of the Mississippi, young people in particular may find promising opportunities in cities like Buffalo and Cincinnati. Zillow Report 🏠 Home Prices and Economy: Corelogic reports a 7.7% rise in home prices for 2023, with the full details expected later this quarter. The economy has defied recession predictions, with GDP growth outpacing expectations. But this strong economic performance means the Fed might not rush to drop rates, which have edged back up towards 7%. CoreLogic 🏗️ New Home Sales and Building Trends: December saw an 8% MoM increase in new home sales, and a shift towards building smaller, more affordable homes. But don't let the 14% drop in median new home sales prices fool you; it reflects the market's adaptation to demand for affordability. Census Bureau 📈 Market Projections and Personal Perspective: While some analysts predict a recovery in sales and a bullish run for new home sales, my view is more cautious. We might be at the peak of the market cycle, with economic uncertainties and high prices influencing buyer behavior. Remember, market cycles in real estate don’t swing as quickly as in stocks, but the pandemic did throw a wrench in the usual patterns. 🤔 Important Considerations for Buyers and Sellers: Whether you're considering selling your home or buying, it's crucial to assess your long-term plans and economic stability. For those contemplating investment properties, understanding the potential rent market fluctuations is key. 🌟 Special Offer: To add a cherry on top, if you refer friends or family to me and they close on a property, you’ll receive $1,500 cash as a token of my gratitude. Let's make 2024 a year of smart decisions and successful ventures in real estate! Wishing you all a prosperous year ahead. Here's to finding that perfect home or making a wise investment in 2024! 🏠✨
Happy Halloween - 2023
🎃 Happy Halloween, Everyone! 🎃 Hope you're all ready for a treat, because the financial world is serving up some interesting news that's anything but spooky. Booming US Economy 📈 3Q GDP numbers just rolled in, and they're as sweet as Halloween candy. With a 4.9% annualized growth, this quarter was the best since 4Q 2021. Does this mean recession fears are like ghosts—just an illusion? Most likely. White House Economic Report The Home Front 🏠 Pending home sales crept up 1.1% MoM. That's something, especially given where mortgage rates are right now. Just remember, we're still near 20-year lows. NAR Report Central Banks' Hold Up 🏦 Looks like central banks are holding off on more rate hikes. If they were Trick-or-Treating, they decided to skip a few houses this time. Smart move. Bonds and Mortgages 🏦 When 10-year U.S. Treasury yields hit 5%, investors pounced like kids on a candy stash. This pushed yields back to 4.85%, also helping 30-year mortgage rates settle in the high 7%s. WSJ Report New Home Sales 🏠 New home sales in September jumped like a kid in a candy store—12% MoM. How is this even possible with mortgage rates nearing 8%? Homebuilders have tricks up their sleeves, like offering rate buydowns. Census Report Mortgage Market 📊 Fed's future? There's a 96% chance of no rate hike, and surprise—a 4% chance of a rate cut! Are we nearing the end of this tightening cycle? Most likely. Atlanta Fed So as you enjoy your Halloween treats, remember that sometimes the economic news isn't as scary as it seems. Stay safe, and have a ghoulishly good Halloween! 🎃👻
What's Up Real Estate - October
🛒 Retail Frenzy & The Fed's Headache People are spending like there's no tomorrow. September retail sales jumped 0.7% MoM, flying past the 0.3% expectation. This stokes fears of 'higher for longer' interest rates. Meanwhile, the 10-year U.S. Treasury yield closed at a jaw-dropping 4.97%, a high we haven't seen since 2007. 🏠 The Big Chill in Home Sales Hold onto your hats. Home sales are at an all-time low, and the number of new mortgage applications has dropped to levels not seen since 1995. What's going on? Between skyrocketing rates and economic uncertainty, buyers are playing it safe. Even adjustable-rate mortgages are making a comeback as people scramble for better rates. 📆 Why Now Might Be the Best Worst Time to Move It's that time of the year when inventory goes up, and prices take a dip. It's the seasonality of the market: not many want to move in the middle of winter. However, some sellers, eager to unload, could offer you a pretty sweet deal. 🎢 Mortgage Rates: Buckle Up! Remember the 7.08% dip in August? Good times. Now, 30-year mortgage rates are over 8%, and the Fed is showing no signs of slowing down. The future isn't looking too rosy either, with a 37% chance of another rate hike in December. 🔮 What's Different This Time? Here's a kicker: The last time the 10-year U.S. Treasury yield was this high, mortgage rates were 1% lower. Blame it on the uncertainty around the Fed’s moves and an inverted yield curve that no one can make heads or tails of. 📚 References New Mortgages: CNBC Report Treasuries Yields: Reuters Retail Sales: Census Gov Mortgage Rates: CNBC Report
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