It’s been 21 years since we’ve seen this
Plus, our best tips for pitching listings
Take some time off this week
It's Thanksgiving week, and we're feeling extremely thankful after a long week in Palm Desert with The Agency family. It was amazing to meet people from all over the country and talk about what we learned in 2022 and what we are expecting for 2023.
Since Thanksgiving is in two days, there won't be a new Blueprint edition on Friday, and there will be no podcast next week as well. We are going to take this time to sign off and enjoy time with our families and friends. Be sure to take some time this week to relax and celebrate the hard work you've put in this year.
We'll see you one week from today!
- James and David
Mortgage lending plummets in Q3
ATTOM released a report on Thursday that shows the number of residential mortgages issued has dropped 47% over the past year. This was the largest annual decline since 2001.
Buyers are not only taking out fewer mortgages, but they are also opting for smaller mortgages and making lower down payments.
Credit card usage and HELOCs have increased as potential sellers are opting to hold off and do home improvements instead.
Even though credit card usage has gone up, the number of delinquencies has not increased.
As interest rates go up, it’s expected that buyers will take out fewer mortgages. It’s great that buyers are adjusting by taking out smaller mortgages or making larger down payments. We never want to see our clients live beyond their means. The normalization of the market is a good thing, and we hope the next inflation report looks like the last!
Townhouse construction stays hot
The townhouse construction market share rose 12% in Q3 compared to a year ago. Here’s a quick overview of what’s happening in this market:
As high interests cause a decline in single-family starts, townhouse construction is continuing to increase.
Interest in townhomes is fueled by home buyers seeking out medium-density residential neighborhoods in walkable urban areas.
Demand for townhomes is likely to remain high when the Fed loosens its tightening cycle. We’ll especially since that trend among first-time buyers in more expensive metros.
More inventory is always a good thing. Do your research on the difference between a townhouse and a single-family home, and be sure to provide this option to your buyers. There are many benefits for a first-time home buyer to buy a townhouse. In fact, it might be the best option for them.
Mortgage affordability remains an issue
Redfin reports that home buyers nationwide need an average income of $107K to afford a home, up 46% from the same time last year. Since the start of the pandemic, the monthly mortgage payment on a median-priced home skyrocketed 70% to $2,682, pricing many buyers out of the market.
Here are the 10 markets with the biggest increases in required income year-over-year:
North Port, FL (+73.9%)
Miami, FL (+63.7%)
El Paso, TX (+63.6%)
Tampa, FL (+62.4%)
Cape Coral, FL (+60.6%)
Omaha, NE (+59.4%)
West Palm Beach, FL (+58.7%)
Charleston, SC (+58.4%)
Albuquerque, NM (+58.1%)
Knoxville, TN (+57.8%)
This is what we expected. With inflation out of control, the Fed had to come in. Mortgage rates are still higher than they were, but historically, rates are still in a good position. Work with your buyers and their lenders to make sure they can afford the property they want. Offer advice to help them secure the best price, and work with them on their budget. Being a valuable resource is something that goes a long way in this industry.
The news that just missed the cut
This $16.55 million compound is West Hollywood’s priciest estate
Check out these innovations helping the housing affordability crisis
This estate's sale was a decade in the making
New home owners in this state are shocked at their tax bills
Here’s how the rental market did in October
See NAR’s updates to their Code of Ethics
🎧 Rise Above the Ranks
In this week’s Rise Above the Ranks podcast, James & David share their best tips on how to pitch a listing. In this business, first impressions are everything! Without listings, you have no business. The competition out there is fierce, and you want to make sure you give yourself the best shot at success.
Here are three tips to help you give a great pitch:
Do your research. Don't walk into a listing appointment without doing your homework on the house and the neighborhood. Develop a Competitive Market Analysis (CMA) and spend some time driving the neighborhood, so you really know the area prior to your initial meeting. You want to educate the seller and be able to answer all of their questions.
Don't lie. Even the best agents sometimes get client questions that they don't know the answers to. It happens to all of us! Don't make up an answer to avoid saying "I don't know." This kills your trustworthiness as an agent. Instead, tell your client that you will check and get back to them on whatever you're unsure about.
Put together a marketing strategy. Before your first meeting, you should create a marketing timeline for the listing that covers everything you plan to do, from photos to staging to open houses. Sellers want to hear the details of how you plan to get them a great deal. Having this timeline ready at your first meeting shows that you're confident and excited about the listing.
You ask, James and David answer!
Q: Do you view social media as a way to build business or a way to keep in touch with clients?
A: Both! We all know the benefits of social media for building business, but it's also a great way to stay in touch with clients. We follow all of our clients on social and stay engaged in ways that feel authentic. You never know when that interaction will turn into something more. We also truly try to build real relationships with all of our clients, as referrals are the best source of leads for us.
Just in Case
Keep the latest industry data in your back pocket with today’s mortgage rates:
Source: Rocket Mortgage
Let's use this next week to be grateful! We found this from a Harvard Health study and wanted to share:
Gratitude helps people feel more positive emotions, relish good experiences, improve their health, deal with adversity and build stronger relationships
Have a fantastic, relaxing Thanksgiving, and we'll see you on Tuesday!
- James and David
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