Your January 2024 Residential Lending News and Successes

Good morning to the New Year,

Mortgage Rates Trending Sideways –


Our Goal:

Turning words, charts, and data into cash, assets, and wealth.

Our conversations and financial strategies, reflect my decades of hands-on experience and professionalism. What I call, “a relationship of success.” So let’s take the first step by calling me now. It is good day to get ready for the Spring Buying Season. Here you will discover that our knowledge base will prove to be a good complement to your dreams, hopes, and goals. The outcome: Making the wise choices, better buy points, smoother transactions, and less stress. So, whether in your working years, preparing for retirement, or in your “asset draw-down” years, we are here to make things better for you.

Key to success: It doesn’t happen in a vacuum. One needs the experience of a proven professional. Start preparing now – Call Mike. The Opportunity is now.


Points of interest – Lots of news – and our predictions for 2024.

Good News Today: Interest rates have taken a needed move lower. This is positive news! It may provide additional hope as we approach the early days of Spring Buying.

More Good News: This month’s numbers continued the downward trend we anticipated. Plus, the lagging “housing and rents” continues to move the overall blend rate, lower for the year. Why Good? The Federal Reserve prioritizes core CPI when considering rates.

1) Interest rates: Interest rates continue below the peaks hit a few times last year. The latest Federal Reserve meeting setup the hoped for pivot point. Currently, the end of rate hikes should continue – unless market inflation turns hotter again.

Stat: Fed balance sheet topped at 8.5 T, now 7.1 T. Noteworthy: It was under 5 T before CoVid. The expectations are a continued reduction below 6.5 T.

Thus, for 2024, there is room for interest rates to further ease. With this, we look for the Federal Reserve to ease, when it comes to quantitative tightening. 2-fold tightening, the interest rate and their balance sheet. As they reduce their balance sheet, this is considered a tightening, it means the Fed is not reinvesting the principle payments is a tightening. The reported goal: keep interest rates supported at current levels.

2) Residential Real Estate: The results are in. In spite of the year-long doom and gloom predictions, residential real estate posted steady increases in values. This is a nationwide number, and local dynamics matter. Some places lower, some higher. All-in-all, the low supply of inventory, relative to demand, will continue to bring more appreciation.

For 2024, we expect single digit appreciation to continue – nationwide – as demand for housing, continues to exceed the number of available housing units – both new and existing homes.

3) Federal Reserve:

The hunt for the targeted inflation rate, with a Core PCE of 2 %. What is interesting: The year long average for 2023, was above 3 %. The current run rate – vs the average for the full year – speaks to the low 2’s. This is a key reason for last month’s pivot by the Fed to hold off on raising rates. This is complemented by reductions in oil prices and easing of used car prices. Both can prove to by volatile.

Staying on the prediction mode, most Fed members believe the unemployment rate will top at 4.1 %. If we get a number higher than this, it will bode well for Fed rate cuts. Bad for economy is good news for interest rates. Key will be the politics of deficit spending and the US Dollar.

Recent Residential Success Story:

Now Me to you:

Success comes in many guises.. Cash-out funding to cover the settling of an estate. New purchases for long-time renters moving into home ownership. Life does continue on.

For those waiting for lower interest rates, it is a good time to consider differing perspectives, one that comes more from a technical point of view. For instance, buying a year ago with higher interest rates, both the property value and property tax base, would be ten’s of thousands of dollars lower than today. Further, as interest rates ease, one has the option to refinance to a lower rate of interest / lower monthly payments. Thus, all else being true, higher mortgage rates do result in less demand, with less multiple offers and fewer overbids to asking prices.

Lets’s talk. Key as we seek more answers to other specific details of our Buyer’s Equation,

Supply shortages: Locally, need for more supply, has many challenges. The easy one’s: Find the areas where many homes can be built. Then, the timeline issues regards permits, qualified construction workers, and overall costs.. I don’t’ expect much change this year.

Affordability: Another often spoken challenge. Let’s review the numbers. 2021: A monthly P&I of $ 1000, needed a $ 4,000 income stream – 240 K home w/ 2.875 rate. Adjusted to today, a 280 K home w/ 6.625 rate, would see an $ 800 monthly payment. To offset this increase, one would need an additional 20% in income. Since 2021 we have seen 15 % income increase and expected about 5 % this year. Thus by the end of 2024, you may have more affordability to buy, than 2021. This outcome, solely due to the benefit of higher incomes.

2024 Predictions: 4.5 to 5 % income appreciation. Transaction volumes: Up 15 – 20 %.

Price drops: It is all in which aspect of the market you track. The bread and butter part of our local markets are holding up the best. Go out to the Coast – the higher cost areas – sales are slower.

There are many ways to observe and analyze the market. The best initial step is to follow general trend lines. Next, dig into specific locational details that fit you. Call me, I love to talk details, dreams, and how best to enhance your choices.

Quick Bits of Helpful News:

1) ADP showed job increases in December of 165 K. We have been running about 100 K per month. Still hot with hospitality and leisure.  Wage increases are slowing, but still positive.

2) JOLTS report for October.  8,733 M. Revision of the previous month, down 200 K. Job openings are continuing to shrink.  Peaked early, in 2022, at 12 M openings.

3) January Jobs report: great number. YET, initially, way more jobs created in December.  The previous 2 months saw revisions downwards 70 K, with average monthly revisions dropping each month by about 40 K. Average weekly earning up a tad. Good for workers, but pared off with a slight decline in average hours in a work week.  Call it even.

4) Rents now showing 1 % drop, year-over-year or 5 months of negative rent growth.  These numbers will help improve the CPI and PCE numbers.

5) Last but still important: Housing loan delinquencies continue at all time lows. Such is the advantage of property values – increasing rapidly this past decade – meaning few are actually foreclosed. Thus, it rarely happen, as the home has remaining equity, if foreclosed.

Good News: The Breadth of Our Lending Possibilities:

We have the best financing options the market offers. Consider: 1) Veterans, 2) 1st time homebuyers with some fabulous brand new programs, 3) self – employed, and 4) investors with and without traditional income sources. Good News: The well-prepared borrower. The lending world, quite cautious with its money, loves the well prepared. Moreover, our lenders offer more options than pre Co-Vid. Call. Lets review options before you buy. Let’s talk today.

Our Focus: Market Disciplines – Now More than Ever

Do you have a desire to create ‘more’ wealth for tomorrow? To feel more secure? Consider the following:

We advocate, teach, recommend options, and complete the task. And we love referral. So as you read this next section, if someone comes to mind who is ready to explore homeownership, please introduce them. It will be a fabulous conversation discussing the realities, the potentials, and the pathway to success. It all starts with that first conversation. It is what I love.

The game-plan in a nutshell:

Rule # 1: Willingness to lay aside today, for more options tomorrow. This may meaning living below your means. Not easy, but the proven path that can be accomplished.

Rule # 2: Investing – Equities, mutual funds, ETFs. I strongly suggest and recommend one maxes out on the retirement account contributions – each year. This deferred income, with tax benefits, builds for future years. Many such plans are offered, with many employer matching contributions. A great perk. Don’t leave it on the table, always being aware of how it’s invested. For many, a great way to keep your money working for you.

Rule # 3: Investing – Real Estate. Yes, yes and yes. Yes today. Yes yesterday. Yes tomorrow. This is another method to put money aside and build, while adding diversity. If your focus is to build for tomorrow, now is the time to talk and prepare.

Divesting Assets: There are times in life where one needs to sell an investment, due to life’s uncertainties. It brings home the need for a carefully review of one’s investment inventory and see if they remain on-track to achieving the intended goals.

Good News: We not only set a plan in motion, we present the handling of the unexpected, or address the significant issues of capital gains. More Good News: We have IRS approved tools and techniques to help keep your hard earned capital gains working for you – to keep them away from the taxman – federal and state – on a deferred basis. Such is the beauty of working with Mike Ryan and Associates. We are just a call away. Planning amongst friends.

Preparing to buying your next home: How about a “tool” that uses your old property, as collateral for the new home? How about tools whereby the current, “old” home payment, does not count against you, as you moved into the new. Want More Options: Call today.

Truly, our letters but scratch the surface of available options, alternatives, and potentials. We are ready and experienced in most every stage of life, to directly help you build a strong investment portfolio – regardless life’s ebb and flow. It is why a key approach to serving you, is to work with your unique view of life – today and tomorrow.

Because You Matter

Our letters are a guidepost to wisely buying, selling, or investing. We understand the importance of being patient and of good timing. Our hope is to address your questions and find real life, customized solutions. It is what I love about my work, especially the people-to-people exchange of thoughts and ideas. It proves the best way to discovery and address your needs and unique viewpoint. To this, we then add our complete set of helpful tools designed to complement the shared goal – your success, today and tomorrow. We are here for you.

Your dreams matter. Thank you for your trust and referrals. It is appreciated.

Call me – Your success is my success.

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