Great thought and a good article!

Dear All,

 

Attached is an article from yesterday’s Wall Street Journal that touches on our current real estate market conditions (all of which we covered at the sales meeting yesterday).

I think this is a particularly good article for your apprehensive sellers who are either holding off from listing or are listed but overpriced.  Here’s why it’s good:

1.        It hits on rising interest rates “testing” buyers’ willingness to pay more than they would like.

2.       There has been a slowdown in sales and traffic in August and September .

3.       Rising mortgage rates are making it more difficult for sellers to ask higher prices in markets (Like our Central Valley) that have experienced the most appreciation in the last 12 months (remember, the National average in price appreciation is about 10% year over year and our Central Valley has had appreciation from (20-25%).

4.       The median sales prices in Fresno (but this range/example is fairly consistent from Merced to Hanford) over the last 3 months have been – June $185,000, July $183,500, August $185,000  -  so the question is, with this stutter, have we reached a ceiling in our current market?  If we haven’t, we’re real close!

5.       Our response to the Sellers’ apprehension and desire to time the market perfectly and sell right at the HEIGHTH OF IT ALL needs to be a standard response – one that you can repeat in your sleep:  “M/M seller, it is impossible to know exactly where the top of the market is until we’ve passed it, and are looking back, and then it’s too late; the train has left the station.  You see M/M seller, unfortunately, there is no bell that sounds when the market’s train leaves the station and 9 times out of 10, if not more, the folks that try to time it just right miss the train altogether and are left holding their bags or in this case, left with an unsold property or having to take less than they could’ve gotten”.   It seems as though the market is signaling that the train is about to leave the station – with that said, where do you think we should be priced so as NOT to miss it?

 

Good luck!

Cheaper to Own vs Rent - Buy now!

Dear Associates,

Below is an article that every buyer must read. Affordable pricing and low interest rates are still making this the perfect time to buy a home or investment property, but the window may be closing.

• Owning is cheaper than renting by 35%

Supporting stats are based on calculating the cost of buying and renting for identical sets of properties, including maintenance, insurance, taxes, closing costs, down payment, sales proceeds, and the monthly mortgage payment on a 30-year fixed rate loan with 20% down and monthly rent. Also assumed that people will stay in their homes for 7 years, deduct their mortgage interest and property tax payments at the 25% tax bracket and get modest home price appreciation (approximately 3% annually).

• Calculations show that for 78 of the nation’s top 100 largest metro areas, the tipping point for the financial gain of owing vs. renting is if interest rates hit 10%.

o    We’re still well below 5%!

o    This is a huge incentive for buyers to buy now!

• Because both home prices and interest rates continue to show signs of increasing, by next year, buying probably won’t be as cheap relative to renting next year.

o    Buy now!

EVERYTHING DONE IN MODERATION EQUALS SUCCESS

Below is a hand-out from the sales meeting in Fresno this week. With inspiration from a few books and several articles that I’ve recently read, I wanted to share a few thoughts that I had. I hope you’ll take a couple of minutes to read them, and a few more minutes to let them soak in, and then take action!

Also, remember that hand-outs like these are good to pass on to your clients and sphere.

Have a great day!

Patrick

Another lifeline is extended to homebuyers....

Dear All,

Attached are two very important reads.  The first is an article from the Wall Street Journal this week on the Fed’s push to ease credit for home buyers, particularly “boomerang” buyers (those that have gone through a short-sale or foreclosure in the last few years, but have cleaned up their credit and are wanting to again purchase).  Government purchased loans continue to make up the bulk of all lending and this can be significant to opening up the market to more buyers.  You don’t have to agree with these steps, but we do need to take advantage of what is out there to help the consumer.

The second attachment is a Q & A on the government’s (FHA) action and illustrates parameters of the initiative.

Please look at both of these and spread the word!  Get those buyers in to your trusted loan officers at Royal Charter Mortgage!

 

Good luck!

 

Sell the Farm and buy the McMansion!!

If your clients, family members, friends, or  anyone for that matter is thinking about moving up, now is the time!

Read the attached article to find out why!

About 60 days ago, I sent out newsworthy information about the price of Jumbo loans falling.  Historically, jumbo loans have always exceeded the cost of conforming loans (conforming in our marketplace as you know, are loans under 417K).  In 2007 the spread was as much as a full 2% difference on a 30 year mortgage.  So if a conforming loan was at 5% then, the jumbo borrower would have paid apx. 7%.  As of the end of June, 2013, the Mortgage Bankers’ Association pegged the spread at only .02% difference and as of today, this article says that Jumbos are now running .02% less expensive than conforming loans.  Mortgage bankers who have been in the business for 30 years or more have never seen nor did they expect this.  To Sweeten the pie, many of the lenders are only requiring 10 to 20% down.  Never has there been such a great time to get a jumbo loan.

Please do 3 quick things:

Read the article

Pass it along to everyone you can think of – time for your past buyers to “Move it on up!”

Have these same people talk to your favorite loan officer at Royal Charter Mortgage

 

Go get ‘em!