The homeowner problem that must be fixed

New podcast episode!

Our podcast Rise Above the Ranks is BACK with a very special guest! He’s a realtor, entrepreneur, social media extraordinaire, and a true character. We talk with none other than New York legend Anthony Bernardo aka Tony B of Island Wide Realty!

We hit a whole bunch of good topics: getting into the real estate industry, how he runs his social media, and his personal work ethic. Scroll down to Foundation Plans and we’ll tell you more about the topics we discussed.

You can listen to the podcast or watch it on YouTube.

It’s a fun conversation and we hope you enjoy it!

- James and David

Home price growth has stabilized

In February, home prices increased 0.6% month-over-month and 6.7% year-over-year, entirely in line with monthly (0.6%) and annual (6.9%) gains in the eight years before the pandemic. That’s from Redfin’s latest Home Price Index. Here are the other trends to note:

• New listings are up 17.8% year-over-year

• Active inventory increased 23.8% YOY

• Homes spent two days less on the market compared to this time last year

Our take

We are so happy to see home price growth return to pre-pandemic norms. This has a lot to do with mortgage rates. Even though rates are elevated, they're not nearly as volatile as before, which has helped stabilize home price growth. While elevated mortgage rates have lowered homebuyer demand, that hasn’t translated into lower home prices. That’s because there’s still a shortage of homes for sale, despite that jump in new listings. Overall, we are more than ready to get off this rollercoaster, and it looks like we’re finally getting back to less–how should we put this?--hectic days.

Fannie Mae revises its mortgage forecast

Fannie Mae expects the 30-year fixed mortgage rate to average 6.7% in Q2 2024, up from its previous projection of 6.3%. Here’s a breakdown of the all the changes to its forecast (previous prediction in parentheses):

• 2024 

  • Q3: 6.6% (6.1%)

  • Q4: 6.4% (5.9%)

• 2025

  • Q1: 6.3% (5.8%)   

  • Q2: 6.2% (5.7%)   

  • Q3: 6.1% (5.7%)  

  • Q4: 6.0% (5.7%)

Our take

While this upward revision from Fannie Mae is disappointing, we saw it coming. The good news: mortgage rates will continue to drop this year and next, just at a slower pace. This is entirely in line with the Fed’s actions. The Fed will continue to hold interest rates steady until it sees clear evidence that inflation is on a consistent path to its 2% target. When it does, it will start cutting. As of now, it expects to make cuts three times this year. Buyers can use the strategy of buying now and refinancing later. While we wish mortgage rates would drop faster, it’s comforting to know that they aren’t spiking wildly. This slow and steady path down is enough to get buyers off the sidelines.

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The states with the highest homeowners’ insurance cost

Last year, the borrowers for a home with a conventional 30-year fixed-rate mortgage had to pay an average annual premium of $1,552. This was 10.8% higher than in 2022 and a whopping 40.8% higher than in 2018, when the average premium was $1081. That’s according to Freddie Mac’s latest update. 

Here are the top 5 states with the highest homeowners’ insurance cost burden:

1. Louisiana: 3.30%

2. Oklahoma: 3.00%

3. Kansas: 2.60%

4. Mississippi: 2.60%

5. Nebraska: 2.60%

Our take

We all know homeowners insurance is indispensable. Unfortunately, as the cost of recovery from natural disasters has spiked, so has the cost of insuring our homes. We need our leaders to come together to fix this problem. NAR and other industry groups need to encourage our politicians and policymakers to address this issue. Otherwise, these costs will become overwhelming.

Schematics

The news that just missed the cut

• Sitzer/Burnette plaintiffs are seeking $4.7 BILLION from HomeServices of America 

• Department of Justice’s role in NAR settlement

• Read this before you hire your next recruit for your real estate business

• This is what real estate tokenization is all about

• These US cities have the fastest-growing population of millionaires

Foundation Plans

Advice from James and David to win the day

As we mentioned up top, a new podcast episode of ours just dropped. It’s with the inimitable Tony B! What a character! We had such a great time talking with him. We discuss getting into the industry, the importance of consistency, the role of social media in real estate, and more! Here are just a few highlights to whet your appetite:

Using social media to your advantage – We shared this stat with you last week, but 43% of consumers are now basing their home-buying decisions on what they see on social media. Tony has become a celebrity, and he owes much of his success to how he has used social media. He discusses how all these platforms have changed how agents can market themselves, and conduct their business.

The importance of being authentic – Some people find it hard to decide how to present themselves on camera, but we honestly believe that you simply need to show who you are. That is the best way to immediately build trust with your clients, and we all know that is key. Remember: you are unique just by being yourself.

Consistency is a must – Our conversation with Tony reaffirmed that success comes through consistency. Especially in this social media world, if you want to be in the conversation you need to stay in the conversation. It’s not about getting it right, it’s about trying to get better every single day. 

As you can probably tell, we got a lot out of our chat with Tony. We hope you do too. Give it a listen and please share it widely with your friends and colleagues! 

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Just in Case

Keep the latest industry data in your back pocket with today’s mortgage rates:

That’s it for this edition of the Blueprint!

Remember: each day is a gift and a new opportunity to lead the life you want and to become the person you want to be. The mistakes and missteps you’ve made in the past don’t define you. Live as intentionally as you can and be ruthlessly focused on the goals you’ve set out to achieve. You can do it!

Have a fantastic weekend, and we’ll see you back here on Tuesday!

- James and David