March 2019 Letter From My Heart

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Good morning to a Month of Transition,

Check out our three helpful facts at the bottom

As we transition to the excitement of Spring Buying, let’s look at some insightful data.

Great News: New signs showing renewed strength in our local real estate market. The absorption rate of new listings – those going into contract – has hit 40 %. Plus each week this rate is increasing. Once again Buyer’s are outpacing the Seller’s. Though much of this activity is the lower price points, we still have 3 M + homes selling. This is a strong base for buying.

The stock market has pretty well recovered from November/December dip, yet dealings with China still lingers as does a slow EU. Personally, I prefer real estate.

Are you prepared for Spring Buying? Solid offers with few contingencies, plus good down payments, are a sure sign the uncertainty of last fall, is fading fast. Such is what I hear from agents talking about recent listings going into contract. Supports our calls to be prepared.

Hoping to buy this Spring? Now is the time to begin preparations. Call today.

Let’s look at the facts. Don’t fall for the headlines of fear. For me, it is a golden opportunity.

Housing Stats:

The fears of rising interest rates has been calmed and days of rapid price appreciation have retreated. Rising rates plus rising home prices – is not buyer friendly. Even Sellers recognize that when a good offer is made, take it. Sales – falling below the 12-month moving average – is proof. Interesting: Locally, entry level homes sales are near double normal market pace.

This period of cooling and digesting also hit the stock market. Now we are witnessing a recovery of all of the slide. Ad to this our belief of a slight downward bias in our rates, we are preparing for Spring homes sales to also show a positive appreciation and accelerating buying. Call today.

Bottom line:
Call today and lets prepare for Spring Buying Now.

Looking further into Real Estate 2019:

1) Settling of disputes with China will be helpful to California.
2) Rates remaining stable. Slower economies in the EU, China, and Japan will help.
3) A stable stock market – supported by a consumer friendly Federal Reserve – should help build buying power for our real estate market. We will keep close watch.
4) Inflation continues controlled: Stable oil prices and rising wages offset by productivity.
5) Local jobs continue growing, yet with limited new-housing construction, there maybe a rise in calls for political interdiction to influence pricing.

The Good, the Bad n the Ugly

The Good: With a strengthening labor market the number of people leaving Social Security disability in favor of gainful employment hit 51,302 last year. This is the highest number since 2002 – when such reporting began – and is well above the 37,000/year back in boom years 2005/2006. The number of Americans receiving disability fell to 8.5 million from a peak of 9 million. People do like to work and take pride in working.

The Bad: Internet-only lending may have advantages, if your buying future is based solely on a sense of the “better rate”. Often reality proves to be its own wake-up call. My suggestion, if you seek home ownership, seek first those with proven experience. Protect yourself with solid planning and careful guidance. Seek those well-experienced and knowledgeable in your local real estate market. Those with a deep list of lenders, who work with proven Real Estate specialists. You will be glad you did. Call us today. Your time and effort is valuable.

The Ugly: Government think-tanks trying to figure out how to get more people into home ownership. It sounds good. But The Ugly is trying to ‘capture’ more people by loosening credit and income guidelines. WE have been here before. Buyer discipline is key to keeping our markets strong and keep homeowners in their home, long-term. Feel good politics often leads to some very bad outcomes. Such planning is unfair to everyone. It is goofy.

The Spring Buying Season

If you, your friends, or co-workers are looking to buy, please contact me or another qualified, proven loan officer. The advice and recommendations we offer have you mind – today and your tomorrow. Our desire is for people to own their homes, ownership based on your best interest and particular situation. WE will not sell you, just to make a sale. Your trust is key.

And please avoid the Internet-only”. Such information can be valuable. But this information does not have my 30 years of experiences, perspective, or gift of understanding you.

I am thankful for your being regular readers. It is my pleasure to bring you what I learn from my extensive reading and many conversations with experienced professionals. And together, perhaps we can keep our politician more accountable – especially regarding real estate housing. Politics is about listening and not to be a special interest club. It’s your community.

Closing Thoughts:

We are the financing arm to help leverage your assets and accumulate wealth. We offer needed information – perspective and plausible financial solutions – with strong lenders ready to say Yes, to your loan request. Give us a call. Let’s start building your future today.

Remember, when considering real estate – short, mid, or long-term – your best success begins in strong preparation. Let us be your team member and advocate for you. Together, we can best explore all options. We provide loans for Small Business and commercial. We are also proud to offer specialized tax-advantaged alternative when selling highly appreciated real estate. Don’t pay Capital Gains taxes unless you want to.

Fun Facts and Interesting Points

As promised, interesting data-points confirming a positive attitude about our marketplace !

1) Homeownership percentages:  65 + at 79 %, 55 – 64 at 76 %, 45 – 54 % at 70 %, 35 – 44 % at 60 %, and under 35 at 37 %.

2) Interest rate predictor: If 2019 real GDP growth is 2%, inflation holds at 2%, unemployment continues no lower than 3.7%, and wage growth is offset by productivity, Fed policy should remain consumer friendly. Above these numbers, expect a rate bump. If these numbers weaken, a quarter point rate reduction is likely. It is the potential that makes these moves important.

4) Homelessness: Homelessness continues to high – 552,830 in 2018, and 550,996 in 2017, and 549,928 in 2016. That said, homelessness totaled 647,258 in 2007. Key to changes in the numbers are due to changes in un-sheltered – vs. sheltered – homelessness. Sheltered in 2007, it was 255,857, declining to 173,268 in 2015. But since then, it has risen to 194,467 – this despite a booming economy.

Suggestion: Perhaps each City should set aside at least 1 Park for a tented Homeless village. It will lower costs, allows better use of services, and protect private property. Just my opinion.

Thank you and continue blessings.

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