Good morning to January – a New Year of Challenges;
Note of the Month: From Dr. Barry Sacks
“Learning is like an onion, it grows one layer at a time and sometimes makes you cry”
Call today. Let’s talk realistic rates and market strategies. What better time than now, as we prepare for the year ahead. Use this link https://michael-ryan.com. An easy short-cut to setting a time for us to talk. You set the time and we will meet by phone. I look forward to our time.
MARKET NEWS
Federal Reserve: The next meeting is the end of this month. Bond yields are again hitting earlier year high points. Inflation still trending lower, but the market is not fully convinced. Note also: Quantitative Tightening continues to reduce their balance sheet. Down about 20 %.
Jobs: Much talk about jobs. Weekly unemployment filing reports will help determine if headlines around “planned” corporate layoffs will lead to increased unemployment. Question remains: Is the data accurate or still subject to significant adjustments? Right now, it seems more of a moving target. Christmas Season data should help give direction. Watch carefully.
Inflation: As expected, numbers continue the glide path lower. It is not a straight line, yet the housing components continuing dropping. Likely pattern for the next few months.
Our Mission: Guidance Based
We strive to help guide, challenge, and support those seeking to build wealth. This pledge is for both our small business clientele and those seeking real estate solutions. Consider us your professional guide for ‘Asset Acquisition and Optimization Strategies’. We are at your call.
Call Now! Let’s start today and we can build upon our first conversation. It is good tool to help teach readiness, good timing, and patience. To this, we offer timely data needed to meet your investing goals. We are ready and this is a “best” first step. Start planning today.
The Good, the Bad, And the Ugly
The Good: Negative emotions – Globally – fell for the first time in a decade
This may surprise those who regularly watch the news. But this Gallup survey has credibility. It is an annual global survey of 146,000 people in 142 countries. It speaks to the first global decline in negative emotions in the last decade. More: Positive emotions reached their highest level since the pandemic – people feeling more well-rested, experiencing more enjoyment, and smiling or laughing more. Across the age groups, young people were by far the best off, and Latin American and Southeast Asian countries topped the list of those feeling better.
The Bad: State of California Housing Needs. See my “Perspective” section below.
The Ugly – Question of Trust: Consider: Athletes are not allowed to bet on games they have the ability to influence outcome. Should not the same apply to those in Congress who are allowed to invest in companies they either regulate or have inside information?
Perspective
This month’s topic is inspired by John Mauldin and one of his recent newsletters. He addresses individual home-ownership vs a headline concern: ‘Oligarchs buying up all the Homes’.
Historical Data: Home ownership. For about 50 years the ratio of owners vs renters has trended about 65 % / 35 %. Home owners have not been squeezed out. As for current trends, ‘investors’ via cash buyers are purchasing about 17 % of the homes sold each month. This is a direct purchase. How many each month – people who already own – buying another to then live in? Answers shows how the numbers can seem to shift.
As for the Oligarchs, a 2020 study found about 3 % of the SFR rentals – Nationwide – are owned by landlords having over 100 properties. Most all “Oligarchs” are actually REITs and thereby owned by individuals through retirement plans, pension plans and stock ownership.
Thus: No Big Bad rich people taking advantage of Poor Little Public. Myth dispelled.
Interesting point on the supply-side of homes. About 2M Airbnb listings – about 4 % of the market – does take a nip out of availability for renters. This provides support for higher rents.
‘The Millions Who Cannot Afford To Buy’; Does anyone deny the fact that 65% of home ownership – over the last 50 years – goes to 65 % of the people ? If the ownership rate was dropping, THEN, and only THEN will the cry of concern, be true. So, for those who do NOT own and would like to.. call! Our knowledge and conversations, can help change your answer – if you do not own!
The real shift in housing – Tax policy. For the past 80 +/- years – until the 2017 tax code – homeowners were incentivized to own. For those who itemized taxes, you could deduct mortgage interest and property taxes. This was drastically reduced with the change with both such expenses falling under “standard deduction” for a married couple – $30 K. Some States limiting property tax deduction (SALT). However, in my 35 years, only a small percentage of buyers made “tax deduction” the primary motivating issue.
Housing solution: Gary Halbert ” offers: The solution to high prices is high prices”. He said this referencing corn and soybeans, yet the fact remains. High prices incentivize more. In Mr. Halbert’s day, it was farmers planting more. In our day, it is builders building more.
The rub. Those not wanting change, conflicting with those local political jurisdictions supporting it. Further: National Association of Homebuilders estimates “regulations and government mandates” add almost $ 94,000 to the cost of a new home. Sad for the available supply of homes for sale. Yet these extra fees do find they way into the general economy. The remaining significant issue: “time needed” to submit and finish construction. Time is money.
Good News:
Homeownership still ranks as the top wealth building tool Americans have. In this we can help. We offer a complete set of tools to help you see what is best for you.
Appreciation vs Inflation – Better perspective: As people, we read of monthly inflation, but as consumers, we pay the cumulative effect at the checkout counter – even if the inflation rate itself, slows. The same is true in regards to property appreciation. It too, has a cumulative inflationary effect – both as to “cost to replace” and locational advantages.
If helpful, long term inflation rate has averaged 3.82 % for 60 years, and 3.1 %, the past 100. This helps put inflation data in perspective, as to when one choose to invest or sell.
Leverage: Learning of the benefits of leverage. A good reason to call today.
Please call, let’s talk. Let’s carefully review options and realistic opportunities.
Readiness: Planning and Preparation
I rarely change this section. The basics for investing are pretty straight forward. What remains is finding the best path to success and the discipline to stay the course. It begins when you reach out to us. Please make the call today, and share this with the people you know.
Should one invest in stocks, bonds, real estate? Each person has a different view of potential, comfort levels, and the sense of risk vs reward. Such is the heart of the market place and key to one’s “planning and preparation”. To this, we offer clients our expertise and experience in order to complement your perspective. Our goal: Bring a full range of meaningful options needed to enhance one’s discernment – based upon market realities. Call today. Let’s set a time.
Our strategies are straight forward, logical, and built on sound reasoning. No doctorate in finance needed to plan and succeed.
Why Call Mike
What We Do – Why We Are Here – What We Offer
We know how to explore and carefully examine the many available options. Yes, we are real estate centric for the long term gains anticipated. While we do NOT ignore other types of investments. We scrutinize for safety and prioritize those most feasible to fitting you. It is how we build a trusted relationship with you. As you grow your wealth and secure a solid future.
Small Business: We love small business and provide a full array of financing tools.
Residential / Commercial: We offer strong lenders and a complete package of lending options.
Retirement Strategies: Like myself, as we mature, real estate becomes more personal. If you agree, let’s talk. Together, we can help find answers and solutions to questions about tomorrow. We can start today. We can address a range of questions, from working at home, to a multitude of retirement options. Our efforts are to bring clarity to important real estate planning issues.
Purchase Options for Investment Properties: We finance, Nationwide, investment property purchases. Little known loans requiring very limited documentation – NO income tax returns. The loans are based upon the properties cash flow. Curious? call. Investing out of the area is not rocket science.. yet you do need to have some knowledge. Let us fill in the blanks for you to succeed and prosper!
Another perspective of ours: Buy Now, buy as much as you can. Why? Let’s Talk.
1) Properties continue to appreciate each year, due to supply / demand imbalance. This increase tends to rise faster, than money we can save.
2) High interest rates can benefit today’s buyers, as it takes out speculation pricing and keeps much the competition out of the market
3) When, and as, interest rates drop many Buyers now sitting on the sidelines will enter the market. In turn this will drive the rate of appreciation even higher, from multiple offers and over-bidding of price.
If these ideas sound good, let’s start talking today.
Making your future brighter today – together.
What We Do: Our role is to explain and bring clarity to time-tested strategies able to keep your money working for you. One worthy and profitable of your efforts and valuable time.
Tools: We offer multiple tools and proven methods. The goal: Offering highly qualified and knowledgable professionals ready to make it happen.
Our Efforts: To be insightful and practical. Working with you, to find answers, matched with carefully planned timing. Priority: Being straight forward, with no short cuts. Truly, success begins with solid preparation and a proven professional – Mike Ryan. I know the ropes and am a proven advocate. I offer time-tested insights and experience. Best, I love to see you achieve your goals. Call us. We are the professional team who stands with you. Call today.
We are ready, feet on the ground, and forward looking !!
Thank you and special blessings for the coming year.
