- The Blueprint
- Posts
- Busting the myth about home investors
Separating fact from fiction
We all know that information in our industry is constantly changing. Something that might be true last year, or even last month, may not be true at all anymore!
In our third story, we have some eye-opening data which spotlights exactly how investors are affecting the housing market. There are many people who still think that these large investment companies are absolutely gobbling up houses, but as you’ll see, that’s not the case anymore.
This is why it’s so crucial to stay up to date on all the latest numbers and reports. Agents are at their best when they have the latest up-to-the-minute data. That way, they know what’s really going on, and can separate fact from fiction.
And with that, we present all of today’s latest stories in this edition of The Blueprint!
- James and David
New listings jumped up big in January
New listings increased by 43.5% month-over-month in January. That’s according to Zillow’s latest market update. Here’s what else happened last month:
New listings rose by 5.8% YOY
Total active listings increased by 1.5% month-to-month and 3.2% YOY
The highest rises in listings YOY were in San Diego (27.7%), Miami (21.9%), and Riverside (20.1%)
Listings sold in 29 days, which is 19 days faster than pre-pandemic norms
The typical home in the US was $344,159, and the typical monthly mortgage payment, assuming 20% down, was $1,760.
Our take
While the 43.5% jump is still below pre-pandemic norms, it’s a huge step in the right direction. The fact that the TOTAL number of active listings rose, not just new listings, is even better news. As we noted last week, lots of homeowners want to sell even if they have sub-5% mortgages. While the situation will fluctuate as mortgage rates rise and fall, we genuinely believe that agents are in a better position to acquire new listings this spring season than last.
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Mortgage rates surge higher again
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($766,550 or less) increased to 6.87% last week, up from 6.80% the week before. According to CNBC, that is the highest rate since early December 2023. Here are other important points to note:
Applications for a mortgage to purchase a home dropped 3% for the week and were down 12% from the same week a year ago.
Applications to refinance a home loan fell 2% for the week but were 12% higher than the same week one year ago.
Our take
The rise in mortgage rates isn’t a surprise given the latest inflation and employment numbers we saw this week. This confirms that the Fed is unlikely to cut interest rates in March. As a result, mortgage rates will likely hover in the high-6% range until more definitive progress has been made towards a 2% CPI. Nonetheless, this spring, buyers are still likely to see lower mortgage rates than in the fall of 2023. This will mean more eager buyers in the market. While mortgage rates will fluctuate, we still believe they are on a downward trajectory for this year.
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Investor home purchases are way down
Investors purchased 50% fewer homes in Q4 2023 compared to two years earlier, according to the latest Redfin data. Investors acquired 46,419 homes in Q4, down from 51,881 in Q4 2022 and 92,802 in Q4 2021.
Here are the top three metros where investors bought the highest and lowest share of homes:
Highest (%)
| Lowest (%)
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Our take
Many people still think giant institutional investors are gobbling up all the homes. The data shows this is no longer true. Investors of every kind – large or small – only made up 18% of all housing transactions in Q4 2023, and the vast majority of investor purchases are made by small landlords who own fewer than 10 properties. In fact, institutional investors – operators owning at least 1,000 homes — accounted for just 0.4% of home purchases. This is why this kind of data is so important. It helps us get a clearer picture of how the market is really operating.
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Schematics
The news that just missed the cut
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Use these scripts to connect with clients and boost sales this year
Two real estate giants formed a joint venture to build new rental townhomes in SoCal
Foundation Plans
Advice from James and David to win the day
Managing your time is one of the most crucial things you can do as an agent. There are only so many hours in a day, and there is only so much you can do to be productive. Today, we’d like to give you some tips and strategies that you can use to master your time.
Preparation is key – You don’t want to wake up and say, “What am I doing today?” You want to eliminate any anxiety and uncertainty about the week. Make sure you know what you’re going to do each day, and have a plan of attack ready BEFORE the day, or even the week, begins. We recommend spending an hour every Sunday night reviewing your past week and previewing your next week. Ask yourself questions about the previous week. Who did I talk to? How was my sales activity? Who did I meet? Who needs to be in my CRM? Then ask questions about this week. Who are my hottest targets? Who am I trying to meet? What family/personal stuff is on my agenda? Basically, use the past to plan ahead for the future.
Block your time and batch your activities – Once you’ve decided what you’re going to do each day, we recommend blocking your time and batching your activities. For example, give yourself a two-or-three hour block on Wednesday to farm an area or make all your follow-up calls. But also batch your activities. Instead of writing an offer letter one minute and then making a follow-up phone call the next, group your similar activities together so that you get into a rhythm and flow. Trust us. You’ll be more effective that way.
Hold yourself accountable – As we’ve mentioned before, each Monday, every member of our team, including us, meets to discuss what we did in the past week. How many sales did we close? How many new contacts did we make? How many pending sales are in the pipeline? How closer are we to hitting our revenue goals? If you don’t have a team, get yourself a mentor or a person you trust and meet with them in person or via video. Make it a non-negotiable. The meeting doesn’t have to be long. Just enough to make sure you are staying on track.
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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 President’s Day, and we’ll see you back here on Tuesday!
- James and David
