Good morning,
The summer season continues strong and active for our clients. While this time of the year is noted for cooling, markets continue hot, as tradition seems ignored. Fortunately not to hot to handle. Though fewer multiple offers, the number of people looking, continues to exceed an increasing supply. This has slowed the fast pace of appreciation, and presents an advantage not to be missed, especially with home-rates beneficially low for buyers and sellers. It is what the doctor ordered.
Let us hope the Federal Reserves stays buyer friendly.
Locally every one of our markets continues on fire, from condo’s to hotels, to businesses and industrial properties. Even more, vacancy rates continue to drop, as do risk rates (“cap rates”) for investments properties. More good news: Silicon Valley is one of the top-5 Metro areas in the Country. One last fun detail: Household median income for the Bay Area, reached $ 96,800.
One small detail of importance.
This October, more of the Dodd-Frank reform, will be triggered. Most notable: Residential loans will bring a new 3-day waiting period. It will include the days needed for loan papers to arrive at the Title Company. It is not happening now, yet the addition of 3 days to close a loan, will cause some interesting feedback. In the end, the bark will be bigger than its bite.
Let’s get to the Good, Bad, and the Ugly:
The GOOD: Mortgage rates remain beneficially low, even with the Federal Reserve talking of raising them by year-end. Why so? Primarily because election years are politically not a good time for rate adjustements. Thus timing may leave the Fed’s in a no-win position. My best guess: More talk than action, with rates remaining favorable. Yet let us not be complacent. If rates are critical for you, I suggest calling us, so we can begin preparations now. One should never try to out guess the world of politics and finance. Far better to prepare for the un-expected, then lose them. We are here to help.
The BAD: Congress and Senate failing again, to address immigration. There are too many dents in this can. It is time for acts of courage and leadership. Let’s see, 1/4 of all US patents are from legal immigrants. At the same time, 200,000 highly-educated foreigners, who went back home, after being trained here. What a loss. They will be our future competitors and we received nothing for our investment. I know finance, not immigration, but those who claim themselves experts, seem unwilling to explain it to us. We have a right to expect more from those we elect. It is their job.
The UGLY: How about another unexpected twist? How about those wonderful credit card and their “Reward” points. Guess what? Nothing is free and someone pays. It is not the Card company. Then there is the fine print to put another tarnish on the Rewards you expected. Did you notice how your flying-points, may not fly as far, after airlines raised rates. My suggestion: Look past the glitter and seek the details and limitations. For myself, I choosing a no-balances approach, whereby there is a credit balance carry-forward each month. And where possible, the “reward” is cash, not points. A good way to save interest expense and know your reward. Then you can thank the credit card for a lesson well-learned. (Perhaps I need to get out more often.)
In closing:
One thing learned these past 25 years, the importance of planning in gaining needed direction and a sense of the “big-picture”. Your comments and suggestion have been most helpful. Yet, the road map is often quite unique. Some may want the happenings of life to bring about needed adjustments. For others, it is more a step-by-step approach, with one or more alternatives for each step. My hope is to listen, adapt, and be flexible to you. Yet key to any successful loan, is preparation. It is the single, most effective tool. This is more true today, and more tomorrow, than ever before. If you are ready to get on the train of success, please give us a call.
Let’s talk about where you are, where you want to be, and together we will build a road map to help you arrive there, safely and with few complications. Successful is not easy, but together, you will find your way, and I will add my expertise, when asked. Have a fabulous day and let’s talk soon.
Gratefully yours,