July 2016 Letter From My Heart

Good morning,

<insert something about “Brexit” and “Uncertainty” here> <insert a few random bullet points about stuff that doesn’t matter here> Woops! I gave away the formula for 99% of any market analysis over the past week,” Rob Chrisman. Could not be a better sentiment for the current market noise.

We are in times of interest and intrigue. Beyond presidential politics, we witnessed the people of Britain voting about membership in the European Union – the status quo. It speaks to the beauty of liberty, freedom, and democracy at work – the people voting their future. A commonality to our presidential politics, may be the sense of a rising dissatisfaction with the status quo.

Our next major vote is but a few months away. It is my hope all my readers will participate, knowing your vote is a statement of who we are as a people and a nation.

Facts, Data, and Statistics

How about some interesting facts, data, and statistics? They can prove helpful.

  1. Interest / mortgage rates: They continue in their unseasonably low band of trading. The world economy remains unsure, relative to the safety of our USA economy. Pending a black swan, there is little reason for concern for direction
  2. Interest Rate & Market Outlook: Inflation is the #1 driver. Rates stay favorable near term, despite continued pressure from big banks.
  3. Housing affordability: Numbers for the 2nd quarter should be available the end of August. We will update you then. The last report revealed little to no movement, year over year. It gives indication that rising incomes or dropping mortgage rates, are helping buyers keep pace with appreciating home prices.
  4. Santa Clara County single-family market is on a track similar to 2014. Although less dramatic than 2015, likely because the supply of homes and actual sales, continues as the last couple of years. In short, demand for Housing still exceeds the available supply, with no foreseeable change. Until then, prices should see more appreciation.

This month’s Good, Bad and the Ugly

The Good: Over the last few years, real estate is again proving itself the better and more stable investment. Further, if one has concern for a possible recession, history shows money tends to move from stocks, into bonds and real estate. Such action will keep rates low and increase demand for real estate – no only here, but also foreign. What does this mean? Real estate should remain a solid investment vehicle.

The Bad: The supply of available “houses-for-sale” does not match up well with the needs of the buying group. This gap difference will likely continue for the next 10 years and keep us in a housing supply quandary.

HUD – Dept. of Housing and Urban Development – has full bi-partisan support to revamp condo approval rules. This positive change will directly effect our ‘go-to’ source for First-Time Homebuyers – the FHA. Currently only 10 % of available condominiums quality for FHA financing. This “new” rule could open up many new doors for a demanding public. Q? Where is the White House when such a positive, needed step is ready to go? Let’s hope DC politics is not a higher priority than we are. It maybe time to ask Mr. Castro, head of HUD and being talked about as a running mate for Ms. Clinton.

The Ugly: Fannie Mae (FNMA) is considering eliminating the credit score as part of the underwriting policy. Really ? If one considers the challenge Lenders and Banks have in determining the borrowers willingness to make the mortgage payment, how does this help? Hasn’t history proven the troubles of putting a social good before financial discipline. Short-term good, resulting in short-lived benefit, with a high cost-to-cure. This is UGLY !!

In Closing

World economies are having difficulties. In comparison, our troubles are no where near as bad, and for this, we should be thankful. And instead of worries, we need to learn to take care of ourselves, put our nation first, and most important – give the creative and innovative people the opportunity to succeed. This would be a great first step to putting the USA back to work, and back in the race. Let’s be #1. Let’s make this our high priority and with it, many of our financial troubles will solve themselves.

SIDE NOTE: Great New

Reverse Mortgages in the Jumbo market, in excess of $ 300,000. Call us.

Our manner of doing business is based upon serving you best. This means staying informed and up-to-date; to be on-top of new strategies and techniques that will help you be even more successful. To add to this, I am contemplating posting on “michael-ryan.com” web-site, the list of learning and on-going education I enjoy each month. It will offered as a separate tab. Give a look at the end of next week and let me know.

Have a fabulous day and as I look forward to our next conversation, even if but for an equity line, to turn a summer dream into your reality. Time proves that conversation leads to needs, needs to strategy, strategy to solutions, and solution to execution. Such is the train ride of safe and successful lending.

Have fun and we remain, Gratefully yours.

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