March 25, 2022
Is 40 the new 30?
David here. Thank you for all the birthday wishes. Some people look forward to turning 30 and finally putting their wild twenties behind them. But I’ve always looked forward to turning 40. I feel like it’s a significant milestone. At 40, you finally know who you are, where you’re going, and what you’re doing. It’s so much more comfortable, right?
Plus, at this point in my career, I finally have the experience and track record I need to work with the kind of clients I only dreamed of a decade ago. This is what we’ve been building up to since we first started.
I’d say I learned a big lesson this past year. It’s one that I think we all know intuitively, but often forget. Real estate isn’t a sprint. It’s a long, slow, sometimes exhausting marathon. But it’s always worth it. I can’t wait to see what the next decade holds for us!
Realtor.com released a detailed report describing exactly who’s buying and selling right now. Their 129-question surveyed nearly 6,000 recent buyers and sellers. There were many interesting stats, but these are the ones we wanted to share with you:
This shows that a lot of buyers are willing to give up some of their wish list items just to get into a home. We’re seeing this in our day-to-day as well. There’s a massive influx of new buyers with this kind of down-to-Earth mentality. Most of those buyers are millennials. Be sure to target potential clients in that demographic, because they are eager to land their first home and might be willing to compromise even more.
Applications for new mortgages dropped 2% last week and are down a full 12% YoY. Refinance applications also dropped 14% week-to-week. What’s behind this slowdown? The average rate for a 30-year fixed-rate mortgage hit 4.5% and home inventory is still extremely low. That means it just got more expensive to buy the few homes left on the market.
Whether your clients are looking to buy or rent, costs are likely to continue rising. With six more rate hikes expected this year alone, mortgage rates could hit 5% or more by the end of the year.
These stats make it look like the market is slowing down, but that’s absolutely not the case. To us, fewer mortgage applications simply means fewer people are finding homes because of low inventory. We aren’t seeing the market slow down at all, so don’t let these numbers stress you out!
Opendoor is poised for an incredible 2022. After purchasing and renovating thousands of homes last year through iBuying, Opendoor is now listing them at an average of $60,000 over purchase price. That’s the highest margin in Opendoor’s history.
These numbers show Opendoor achieved what Zillow couldn’t. Zillow struggled with its purchase-price algorithm, causing the company to overpay for these homes and then sell them at a loss. But Opendoor’s slow-and-steady approach is fully capitalizing on today’s home price appreciation.
The news that just missed the cut
Advice from James and David to win the day
As a new agent, filing your taxes for the first time can be daunting. We remember our first tax year after we started our real estate business. It’s overwhelming! But these tips can help you prepare for April 18th and keep more of what you earn:
There’s no question that paying taxes is never fun. But we think of it like this–the more taxes you have to pay, the more you earned this year! We have been paying off quarterly taxes for as long as we can remember. It’s easier for us, and it stings less. In a way, it’s actually a good thing to set aside more for your quarterly taxes. It means you’re doing something right!
Disclaimer: We’re real estate pros, not CPAs. Definitely consult with a tax expert if you have questions about your unique situation.
You ask, James and David answer!
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Keep the latest industry data in your back pocket with today’s mortgage rates:
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Have a great weekend.
- James and David
P.S. This meme made us laugh this week. Too true, right??
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