Important perspective on mortgage rates
Plus, 4 ways to buy your first home
We want to send a big thank you to all the 500 people who attended our first-ever online masterclass! We hope you enjoyed it as much as we did.
For any of you feeling FOMO right now, don’t despair! Our course is now available.
Just click the link right here!
- James and David
Residential real estate value breaks record
The U.S. housing market has grown in value by more than $2.6 trillion year over year, surging to a record $51.9 trillion, which bests the previous peak reached in June 2022 by $1.1 trillion. That’s according to Zillow’s latest analysis of the U.S. housing market. Here are the key points:
The total value of the U.S. housing market is 49% higher than before the pandemic.
New York, Los Angeles, San Francisco, Boston and Miami are the most valuable housing markets.
The top 5 states with the most valuable real estate markets, in order, are California, Florida, New York, Texas, and New Jersey.
There are many factors driving the rise in home values, but builders are the main one. This is why it’s so crucial to know everything you can about builders in your area. Know everything you can about their plans for the future and the challenges they are facing. For example, not all residents are keen on the idea of new apartment complexes being built in their neighborhoods. It’s this kind of knowledge that can help your buyers explore their options.
Mortgage rates reach 22-year high
Mortgage interest rates surged upward again this week, reaching levels not seen since 2000. The average 30-year fixed-rate mortgage landed at 7.31%, according to the latest Freddie Mac survey. That's a big jump from last week's 7.19%. The 15-year fixed-rate mortgage also rose to 6.72%.
We know this news is a bummer, but this is our new reality. Elevated mortgage rates are here to stay. Another rate hike by the Fed is definitely on the table for this year. Interest rates will remain higher for longer, and the yield on the 10-year treasury is expected to rise as well. But if your clients are seeing this as a big negative, remember to put it into context for them. Remind them that today’s rates are still BELOW the average of 7.7% since Freddie Mac started tracking mortgage rates in 1971. When you look at it that way, it gives everyone some good perspective.
A record share of homebuyers are relocating
According to Redfin’s latest migration report, a record 26% of homebuyers are looking to move to a different part of the country, up from 24% a year ago and roughly 19% before the pandemic began. Although many of the most popular relocation destinations are more affordable, they are also increasingly susceptible to extreme high temperatures and hurricanes, where home INSURERS are leaving!
Top 10 metros where homebuyers are moving (by net inflow):
Sacramento,CA – 5,100
Las Vegas, NV – 5,000
Orlando, FL – 4,300
North Port-Sarasota, FL – 4,000 (Tie)
Tampa, FL – 4,000 (Tie)
Myrtle Beach, SC – 3,700
Cape Coral, FL – 3,600
Dallas, TX – 3,400
Portland, ME – 3,300
Houston, TX – 3,100
If home shoppers do end up buying homes in their top search destinations, that means more people will be moving to areas facing increasingly intense weather events. It’s been boiling hot in Sacramento and Las Vegas, while Floridians have been pummeled by more intense hurricanes. These are exactly the states where home insurers are leaving. This is a huge issue that state regulators must address soon! Otherwise, the housing markets in some key states will be thrown for a loop. After all, you have to have home insurance if you want a mortgage!
The news that just missed the cut
Fort Lauderdale: https://tinyurl.com/bddtu7ba
Advice from James and David to win the day
We already know 2024 isn’t going to be a cakewalk. So, throughout this upcoming quarter, we’ll be sharing our tips on how to get ready for the challenge. Today, we’d like to share with you some of our thoughts on negotiations.
Do your homework – Before you negotiate, be sure to study things like the price per square foot, comps, and recent sales. Having the basics down pat means you’ll come to every negotiation feeling confident that you have all the facts necessary to get your client the best possible deal.
Know who you’re negotiating with – When you represent a buyer, it’s also important to understand what the seller wants too. Maybe a longer escrow will make the deal more attractive, or maybe writing a letter to the seller will sweeten the pot. Every client is different, and the most successful agents know how to navigate both buyer and seller.
Focus on the objective of the negotiation – In every negotiation, you’re teaming up with the other agent to get the deal done. Working together means you’ve got to put your ego aside and put your clients first. Take emotions out of the negotiating process. Rather than trying to one-up the other side, try to make it a win-win situation.
For more on negotiations, start here for extra tips from our colleagues in the business.
Just in Case
Keep the latest industry data in your back pocket with today’s mortgage rates:
Source: Mortgage News Daily
That’s a wrap on 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!
Thanks for reading, and we’ll see you back here on Tuesday!
- James and David