COMPLIMENTARY SPRING CLEANING FOR DOLLAR POINT PROPERTY OWNERS
Tag: Real Estate
HOW TO BUILD WEALTH AS A WOMAN
I’m hosting a workshop at the Wyld Women Summit 2023 on “How to Build Wealth as a Woman” and could not be more fired up. This topic is something that I’m really passionate about, and I’m excited to share what I’ve learned along the way in my own journey.
March 30, 2023
You can purchase a ticket and learn more about the event here
Image by Wandering Wyld
Not Alot of Clients Right Now? Here’s What You Should Be Doing
The ebb and flow of the real estate business can be affected by the seasons, the economy and more. Here’s how to weather the slow times while building your business.
Article Originally Published by Inman Connect
February 17, 2023
I sell real estate in Lake Tahoe, a seasonal and second-homeowner destination. Due to our unique market, I’ve become accustomed to the inevitable slowdowns every fall and spring.
At the beginning of my career, it wasn’t easy to normalize the downtime and find productivity in my business, even without clients. I would become anxious, stressed and paranoid until I found ways to utilize my free time efficiently.
Below are a few steps that you can implement in your business when you’re low on clients:
1. Remind yourself that every single agent, even the most successful agents making millions of dollars every year, experience lulls in their business
We’ll have highs, lows and everything in between. So while you’re having your best year, I could be having my worst year. That doesn’t mean you won’t ever sell a house again; it just means that the timing of your clients, or future clients, hasn’t reached the inflection point of a sale yet.
As hard as it is to not compare yourself to others or desperately watch the sales tick away in the MLS without your name, work on staying grounded and believing that your time will come. A positive mindset will work wonders for you, while a negative mindset can negatively impact your work.
2. Work on your business instead of in it
The downtime is a great time to master your systems, become clear on what is working and what isn’t, home in on your farms, get to know the behavior of your farms and more. The downtime allows you the gift of time, which is when most of us can be the most creative.
I like to start each day by sitting in silence for 20 minutes. I put a timer on my phone and don’t pick up any electronics during those 20 minutes. I simply sit with my thoughts and let the creative juices flow. I have a journal dedicated to my “thinking time,” I journal down all of my ideas once the timer goes off. I have my best (and most fun) marketing ideas during this time.
3. Plan events or create a value proposition for past, present or future clients
Planning events can be time-consuming, so downtime is the perfect opportunity to work on one. Contrary to popular belief, you do not need to shell out a large chunk of cash to host a successful event. In fact, you can do it for free.
Recently, we hosted a free, first-time homebuyer seminar with a local mortgage broker at a brewery in town. We used social media to market our event, had the space donated to us and put together the slides ourselves. We had over 30 attendees, many of whom converted into leads.
The best part? We’ve been able to help our first-time, local homebuyers buy a home in Tahoe.
By creating and hosting events such as this, you’re helping others, first and foremost, but you’re also adding more familiarity to your name and what you do, which is what marketing is all about.
4. Spend time with people you love and your past clients
My favorite type of lead is a referral from someone I know, like and trust. There is no greater honor than being introduced to a friend’s friend based on their confidence in me as their Realtor. The best way to gain that trust is simply by spending time with people.
Ask friends out to coffee, mention your business and what you’re doing, and ask them about their business. Be genuine.
If you don’t have the funds to take someone out to coffee, ask them to go on a walk, start a book club or tailor it to their and your personal interests.
These meaningful moments with people go a long way. The more time you spend working on the relationships in your life, the more people will think of you anytime the word real estate is mentioned.
5. Ensure all of your online profiles and social media channels are up to date
This one is self-explanatory, but make sure your bio is correct on every real estate site, add all of your past sales, ask past clients for reviews, and do your best to stay as relevant as you can online. Your online presence makes a difference, and finding time to dedicate to this is essential.
While it may be hard to mentally adjust to having very few clients, I hope you can look at it as a positive with unlimited potential to unlock the next phase of your business. If you are running at all cylinders all of the time, you won’t be able to ensure the mechanics of your business are still operating at full capacity.
I like to think of real estate like a conveyor belt: If you become too focused on the end of the line (closings, current transactions, etc.) you won’t have anything to work on once you reach the end because you haven’t been reloading the belt with new items (i.e. new clients and escrows). Therefore, to reach your full potential in this business, you must master the conveyor belt from start to finish.
Amie Quirarte is a luxury real estate agent with Tahoe Luxury Properties in California and Nevada. Connect with her on Facebook or LinkedIn.
There’s Freedom in Saying No, Setting Boundaries, Saying Goodbye
If you don’t set boundaries, you can’t expect clients to respect them. Set firm boundaries, and communicate them upfront.
Article Originally Published by Inman Connect
February 15, 2023
As real estate agents and brokers, it seems as though many of us are programmed to always say the magic word “yes.”
Yes, we can squeeze 21 showings in one day despite them being on completely opposite sides of town. Yes, I can talk at 11 p.m. Yes, I will “make” the sellers fix every item on the home inspection list.
Scarcity is typically the main driving force behind the obsessive “yes” in our business, but I think for many of us, it can contribute to a downfall in our personal life and burnout in our professional life.
We’re scared that if we don’t answer every call as it is coming in, the lead on the other end may hang up and call someone else. And while that may be true, what do we, in turn, sacrifice to catch every potential lead that comes our way?
If every lead turned into a sale, then perhaps most, or at least some, of the yeses are warranted. But if they don’t always convert, and let’s be honest, we know they don’t, then we owe it to ourselves to be more mindful of what type of interruptions we are allowing into our lives.
I learned the power of “no” pretty early on in my real estate career, though it took me many years to truly master it.
I wasn’t even old enough to drink a beer when I got my real estate license, and I felt like I had to work five times harder to be taken seriously than everyone else. I was a young female with no experience, and I noticed that I would tolerate much more than I normally would from clients because I was scared of losing the lead or the sale.
I would allow clients to speak to me disrespectfully, call or text me during non-business hours and quite honestly, at times, let them walk all over me. Until I decided I had enough.
If I didn’t set boundaries, I couldn’t expect my clients to respect them. So, I decided to set firm boundaries and communicate them upfront.
Here is what my boundaries sound like:
Set business hours, and stick to them
I will be available from 8 a.m. to 6 p.m., Monday through Saturday, unless it’s an emergency. An emergency in real estate is a multiple-offer scenario, tight expiration dates or anything that requires urgent attention. A real estate emergency is not transferring utilities.
I found that by communicating these boundaries upfront, the interruptions are much less frequent (if at all), and on the rare occasions they do happen, I’ve found clients to be much more appreciative of my time.
Communicate upfront about realistic expectations of the other party
I might say something like:
“I do not work for the other party in the transaction (buyer or seller, depending on which side you’re on), and therefore, I can’t force anyone to do anything they aren’t willing to do. My job is to represent my client and do everything in my power to collaborate with the agent to achieve our mutual goal of closing.
“However, I can’t force the other side to perform, agree to repairs or come to your price any more than I am able to force you. I can take all the necessary and available steps, and I will, but my hands become tied at a certain point. This is a collaborative business, and I refuse to be attacked if the other party isn’t behaving like you want them to.”
This is an important part of my boundaries because, in the past, I have been blamed for the other side’s X, Y or Z. I remind my clients that the buyer or seller on the other side is a human, just like we are, and they have a right to make their own decisions. It’s then our job to decide if those decisions are something that we feel comfortable with.
Read the contract
Read the contract, read the contract, read the contract. I cannot tell you how many times I have had clients upset over something that was in the contract that they signed. If you are signing anything, read it carefully.
I always make myself available to review the contract together or to answer any questions or concerns, however, it’s the client’s responsibility to read the contract and ensure they understand it before signing it.
Included in every DocuSign envelope is a note from me that says, “Did you have a chance to read this, and do you feel comfortable moving forward with the terms outlined in this?” Trust me, this will save you many headaches and frustrating conversations down the road.
Do not be afraid to fire clients or say no to something that doesn’t feel right to you
Sometimes, the best decision you can make is to let a client go. At a certain point, regardless of how much time or energy you have spent with the client, you may need to let someone go. I’ve done this many times, and it has gotten much easier as I’ve seen the rewards.
Think of it like this: If you’re spending all of your time with one client, you are not making room for new clients who could be a much better fit for you. Remind yourself of this: You are not the perfect Realtor for everyone, and not every client is a perfect client for you. Just as you do in other aspects of your life, choosing your relationships carefully will have a profound impact on your success and happiness.
Some of these may sound harsh, but after 10-plus years in this business, I have found that being honest with everyone, including myself, is the best way to succeed. If I am working with someone who is disrespectful and draining, I will not be the best version of myself nor reach my full potential as their agent. But, another agent will, and both the client and you deserve that opportunity.
Allowing some clients to seek out new representation (if the circumstances require it) will allow you to find the client who is a better fit for you — and that’s a win-win for everyone.
Amie Quirarte is a luxury real estate agent with Tahoe Luxury Properties in California and Nevada. Connect with her on Facebook or LinkedIn.
Fed Chair is Back After Strong Jobs Report
After last week’s surprisingly strong Jobs Report, Fed Chair Jerome Powell spoke about the economy and direction of rates. Let’s walk through what happened and what to watch in the week ahead.
“Cause I’m Back, Yes, I’m Back” – Back in Black by AC/DC.
“The strong Jobs Report shows you why we think this will be a process that takes a significant period of time.” Fed Chair Powell 2/7/23.
Partner, Mortgage Consultant CMPS
O’Dette Mortgage Group
February 14, 2023
The Federal Reserve has a dual mandate, which is to maintain price stability (inflation) and promote maximum employment. On the inflation front, it appears inflation has indeed peaked and is on the decline. The Fed Chair reiterated the “disinflationary process” has begun. This is a positive development for the economy, housing, and long-term rates.
On the labor market front of the Fed’s mandate, the Fed in its desire to slow demand and thus inflation, wants to see some unemployment. The good news/bad news? Last week, the Bureau of Labor Statistics (BLS) reported the unemployment rate at 3.4%, the lowest in 53 years…that is good news. The bad news is it means the Fed will look to raise rates by .25% in March and another .25% in May, thereby lifting the Fed Funds Rate above 5.00%.
This renewed outlook for a higher Fed Funds Rate has elevated uncertainty and volatility in long-term rates, which move up and down based on economic conditions and inflation, both of which are easing and a reason why long-term rates are lower than short-term rates.
“Likely to see some softening in labor market conditions” – Powell
This is a reasonable assumption considering the number of planned layoffs announced this year, while we sit at multi-decade low unemployment, it seems like up is the only direction for unemployment.
Soft Landing Back in Play
Due to the current strength of the labor market, there is a growing chance the Fed can raise rates and lower inflation towards its 2.00% target without triggering a deep recession.
History has shown that recessions do not take place with unemployment at 4% or below without some sort of surprise shock to the economy.
Let’s hope the Fed is not too successful in “creating” unemployment because if it quickly rises, the idea of a soft economic landing could go away quickly too.
3.70%
As we mentioned, long-term rates have responded negatively to last week’s strong jobs report, because good news is bad news for bonds and rates. The 10-yr Note touched 3.33% last Thursday and touched 3.70% just a few days later. However, rates remain beneath where the 10-yr yield opened 2023 at 3.85%.
“We are going to react to the data” – Powell
Here the Fed Chair reminds the markets that last Friday’s Jobs report was strong, but backward looking and lagging while other economic indicators show signs of s slowdown. The Fed does not want to over hike rates into a slowing economy and be the reason for the recession. So, while the market is currently pricing in two more rate hikes and a rate cut in December, this story could quickly change once again.
Bottom line: Rates and inflation have peaked. Housing activity has jumped in the past weeks as a result. The incoming data will determine how much better rates can get in the next few weeks leading to the next Fed Meeting.
Looking Ahead
Next week’s CPI is a very important number. If it meets or comes in lower than expectations, we could see home loan rates revisit the levels seen last week right before the Jobs Report last Friday. We will also see the latest readings on housing and the strength of the consumer, by way of Retail Sales. As fast as the story changed when the strong jobs data hit, things can change quickly upon these reports.
Breaking News: Today’s CPI Inflation
Partner, Mortgage Consultant CMPS
O’Dette Mortgage Group
February 14, 2023
The all important CPI (consumer price index) inflation came out this morning and mixed news; the year over year January CPI report fell to 6.4%, which was a hair lower than last month’s 6.5% – which is good, but higher than market expectations of 6.2% – which could have been better.
Reminder inflation is the arch enemy of bond prices, and therefore mortgage rates, and the reason we’ve seen mortgage rates improve since what appears to have been the peak in November is because inflation has been coming down. CPI peaked last summer at 9.1%, and has since been steadily decreasing. It was the November & December CPI reports coming in lower than market expectations that were the impetus for mortgage rates improving over the past few months, and then last months data at 6.5% came in right at expectations, so today’s report was much anticipated and bucked the prior three month trend and came in higher than expectations.
Looking at the numbers from a month over month perspective, which is arguably the most relevant in measuring present trend, the month over month figure was up 0.5%, which was up from 0.1% last month. Shelter (housing) is the biggest factor here increasing 0.7%, making up the majority of the month over month numbers. National housing costs are not coming down.
This month’s jobs & CPI reports are now behind us, the labor marker remains very strong, and inflation is moving lower, albeit slowly. Inflation creeping lower is good, but as expected we should not expect a straight-line drop in prices, and there will be slower and outright pauses in declines going forward.
As a result of this morning’s CPI report, bond yields/mortgage rates have ticked a hair higher. See chart below of the 10 yr T, which jumbo rates are based on, for a graphical context. As you can see, rates peaked first week in November, have since come down a bit, and now giving up a bit of ground.
Regarding conversations with clients; 30 yr fixes in the 6%’s with option of getting into the 5% with points, is a healthy “normal” place for them to be, and still well below historical long term averages. We’re still seeing jumbo rates notably lower than conforming (approx ~.625% .75%). Lastly, even after rates have improved, considering grossing up a sale price & requesting a seller credit can still be a good strategy to get buyers into not just a more palatable rate, but one that is really quite good and a loan they may hold for as long as they’re in the property.
When Your Toughest Competitor is the Other Agent
Article Originally Published by Inman Connect
The next time you experience a hot-headed real estate agent on the other side of the deal, try these tips to cool it down
February 14, 2023
We’ve all been there — the agent on the other end of the transaction is aggressive, short-fused, and impossible to work alongside. Every question or request is met with confrontation, and there is no attempt at collaboration toward the shared goal of closing the transaction.
So, what do you do? Do you meet them with the same anger, carry on with a hard exterior, and beat each other down until you cross the finish line? Or do you find a way to be the bigger person and “take one for the team” so everyone can peacefully work together?
In this situation, I like to give myself the same pep talk I give my 8-year-old daughter and bring it back to the basics: Typically, other people’s frustration has nothing to do with you. You may have become the scapegoat for the other agent’s problems, fears or worries without even knowing it. The other agent likely has something going on in their life, causing them to treat others in a way that can feel aggressive or hurtful. The best solution is to be direct and kind, and approach the situation thoughtfully.
Below are a few common examples of dealing with unreasonable agents on the other side of the deal and how I deal with each one.
The agent who speaks for the clients
For example, if an agent is attacking me for my client’s request for repairs, I always ask the same question as calmly as I possibly can:
“Have you talked to your client yet? Is this their reaction, or is it yours?”
This is my favorite question because it offers a moment of inward reflection and pause from the agent on the other side. Often, I will learn that the client hasn’t seen whatever document we’re talking about yet, which offers additional insight on how to approach the remainder of the transaction.
The overreactive agent
If I know the agent is quick to react, I can be more strategic in each conversation I have with them from that point forward. So, for example, if I need to begin a conversation that may cause friction, I’ll lead with something like this:
“We are on the same team, and I want to work with you to get this deal across the finish line. To do that, we have to come to some type of agreement on repairs. Why don’t I share my client’s requests with you, and then we can brainstorm together on how to find a middle ground.”
Approaching each conversation from a collaborative perspective sets the tone, and it’s basic human nature at that point to respond more respectfully.
The agent who needs boundaries
But what about when you have an agent on the other side who sees red and won’t respond well to your approaches? That is when your directness and boundaries come into play.
If you have an agent, or a client, who is treating you poorly, the first step is to calmly communicate the boundaries in which you’re willing to communicate.
For example, if every time you pick up the phone, the agent raises their voice to you, you can communicate via email and say something like:
“Based on our past few phone conversations, I have decided we should only communicate via email from now on. I do not appreciate being yelled at or spoken to in the tone I have experienced. I am willing to attempt a phone conversation again if we can agree on how we will work together to achieve our mutual goal of closing this deal.”
Bringing awareness to your boundaries and the way the agent has been treating you will almost always warrant a more respectful conversation. But if it doesn’t, hold true to your boundaries, and only communicate under the terms you see fit.
Real estate is a highly emotional business because we are helping clients with their most valuable investments, but it doesn’t mean that we, as agents, need to take on these same emotions. I see it as our job to stay calm, cool, and collected, especially in the face of turbulence. The next time you experience a hot-headed agent, try these tips to cool it down.
Amie Quirarte is a luxury real estate agent with Tahoe Luxury Properties in California and Nevada. Connect with her on Facebook or LinkedIn.
Good Economic News is Good News
Interest rates hover near the best levels since September, despite several good economic readings reported. Let’s discuss what happened and see what is coming next week.
“Hey, alright now And don’t it feel good” – Walking on Sunshine by Katrina and the Waves
O’Dette Mortgage Group
January 30, 2023
Economy Grew to Finish 2022
Gross Domestic Product, a measure of economic growth, for the Fourth Quarter 2022 showed the economy expanded at a 2.9% annual rate, down slightly from the 3.2% rate in the Third Quarter 2022. Seeing the economy grow in the back half of 2022 after negative growth in the first half of 2022 is good news.
This positive reading elevates the chance of a “soft landing” by the Fed, where they hike rates to slow inflation but do not slip us into a recession.
Unemployment Line is Historically Short
Initial Jobless Claims for December came in at 186,000…the lowest reading in 9 months. This is also good news as it tells us the length of the unemployment line. If the amount of people signing up for first time unemployment benefits remains near historical lows, it further lowers the chance of a recession. Moreover, it highlights the continued strength in the labor market, and this is paramount as jobs buy homes. Yes, we want interest rates to move lower but if someone doesn’t have a job or is in fear of losing their job, they can’t commit to a home purchase. Let’s hope the labor market remains strong as the Fed continues to hike rates to slow demand and lower inflation.
New Home Construction Costs Coming Down
The National Association of Homebuilders reported that building materials costs, less energy, are up 8.3% which is a big increase annually. However, the price growth is down a staggering 60% as input costs increased over 16% in 2021.
We should expect input cost growth to slow further in response to slower demand and further reopening of supply chains. This is another positive theme as we move through 2023.
Smaller Fed Rate Hike Still Priced In
One of the headwinds to the economy is the threat of higher short-term rates by the Federal Reserve. The good news there? After four consecutive .75% rate hikes, followed by a .50% hike in December, the financial markets are fully pricing in a smaller .25% hike at next week’s Fed Meeting.
The markets also believe the Fed will raise rates by another .25% in March and then pause to allow all the hikes that date back to last summer to seep into the economy.
This means the Terminal Rate, or the fancy way of saying the peak in the Fed Funds Rate, is going to be in a range of 4.75- 5.00%. From there we will have to continue to watch the standoff between the Fed who says they want to keep rates higher for longer. Additionally, with no rate cuts this year versus the financial markets, which are starting to “price in” as many as two rate cuts later this year.
Bottom line: The economy is showing mixed signals, but the labor market remains strong, and we are nearing the end of Fed rate hikes. So, the plan to land the U.S. economy softly and avoid a deep recession remains very much in play. That is good news for housing and the economy.
Looking Ahead
Next week is Fed week. As of this moment, the markets fully expect the Fed to raise rates by .25%. Anything other than that would be a surprise and generate a lot of market volatility. The Fed generally looks to avoid sending the market mixed signals but the markets will be on edge.
How These Agents Found Success in the Face of Tragedy
Amanda Marsh and Amie Quirarte shared their personal experiences at Inman Connect New York on Thursday and talked about channeling endurance and resilience.
Article Originally Published by Inman Connect
When Amanda Marsh was 15, her life turned upside down.
While visiting her extended family for Thanksgiving in November 1993, she received a phone call from her grandfather detailing the unthinkable: Her mother, father, and sister had all been killed in a car crash on the way to pick her up at the airport, leaving her an orphan.
“I went from being a 15-year-old carefree teenager that wants to go to the mall, to a part of me died with them that day,” Marsh told the crowd at Inman Connect New York on Thursday. “That was my life-defining moment where I looked internally at ‘who am I going to be?’”
Marsh, an agent at Cantrell Real Estate in Springfield, Missouri, spoke on a panel with Amie Quirarte, of Tahoe Luxury Properties, moderated by Inman CEO Emily Paquette about channeling endurance and resilience when confronted with dramatic change.
For Marsh, becoming an orphan left her faced with a choice in how to respond and grieve. Instead of letting herself be crushed, she found ways to be resilient.
“I was not going to crumble, and I was not going to let tragedy define my life,” she said. “I wanted to make my family proud.”
As a result, Marsh says she has kept herself busy for the past 30 years.
“I have been busy since Nov. 27, 1993 — call it what you want, it’s probably most likely a trauma-based response — to pour myself into absolutely everything that I do,” she said. “I’m passionate about anything and everything… it has helped me to become the businesswoman that I am.”
Emily Paquette, Amanda Marsh and Amie Quirarte at Inman Connect New York | Photos by AJ Canaria & Mercedes Santiago of MoxiWorks
For Quirarte, real estate offered an opportunity to succeed regardless of her background.
Quirarte’s father committed suicide when she was 9 years old, and her mother struggled with drug addiction. She was raised by her grandfather, who was married to an addict.
“We had a lot of turbulence in my life,” she said. “Most of my life was spent going in and out of homeless shelters, not knowing where my next meal was going to come from.”
When her grandfather died, Quirarte moved to Santa Barbara to attend community college, a moment she felt was her first opportunity to escape her family’s troubled past.
Because she had no family to support her, she worked several jobs to keep herself afloat while attending school and ended up having to drop out of community college.
“I have never felt like such a failure in my entire life than I did at that time,” she said. “I genuinely had no idea what I would do that would be different than what I was destined to do.”
But then, she started working in the real estate industry.
“It sounds really cheesy and really cliche, but it changed my life in a very big and important way,” she said.
Real estate presented itself to Quirarte as a world where she could achieve real success and where her background couldn’t slow her down, and the only thing that mattered was her own competence.
“It didn’t matter, my education background or my family background,” she said. “Real estate does not discriminate. Success in this business is truly what you make it. It does not have to be about where you came from or what success you’ve had in other ventures. It’s all about you, and that’s awesome.”
Amie Quirarte is a luxury real estate agent with Tahoe Luxury Properties in California and Nevada. Connect with her on Facebook or LinkedIn.
Breaking News: CPI Report at 6.5%
The Consumer Price Index (CPI) measures the monthly change in prices paid by U.S. consumers. The U.S. Bureau of Labor Statistics (BLS) calculates the CPIas a weighted average of prices for a basket of goods and services representative of aggregate U.S. consumer spending.
O’Dette Mortgage Group of Synergy 1 Lending
January 12, 2023
January’s CPI (consumer price index) inflation data was released this morning and came in right at expectations of 6.5%. This is good news as it’s notably lower than December’s reading of 7.1%, and CPI inflation has now moved lower for 6 consecutive months, with the last 3 CPI reports being the real catalyst in mortgage rates lower. While this 6.5% CPI figure remains notably higher than the Fed’s target of 2% inflation, today’s report was still good news in the context of how inflation/mortgage rate are recovering from the distortion created by the Fed’s red line full throttle bond purchase program during Covid, and all supply chain related Covid issues which are mostly in the rear view mirror. Here’s some context to share with clients and what it all means for mortgage rates.
We’re currently in this interesting window of time where it’s valuable for real estate investors to understand that increases to the Fed Funds rate does NOT mean mortgage rates increase. Sometimes reiterating the mechanics of what determines mortgage rates (bond prices, which have move significant been determine by 2 things in the past few years: the Fed’s bond purchase program and inflation) can instigate the question of; “why does it matter if the Fed hiking the Fed Funds rate isn’t what drives mortgage rates higher, it seem they’re usually moving in the same direction?”, in other words – does it really matter if it’s correlation or causation?
Answer: yes – very much so, and the current market is precisely why it’s so important to clearly communicate the differences & mechanics for clients. As of November, we are now in a phase where the Fed will continue to hike the Fed Funds rate, while mortgage rates are moving lower. This is key for those looking to capitalize on a real estate opportunity before mass market sentiment pendulums back.
Here’s what’s going on with inflation mortgage rates: CPI, a primary measure of inflation, had peaked at 9.1% this past summer. The Fed hikes the Fed Funds rates (short term consumer debts) to fight this inflation. The November & December CPI reports both came in notably lower/better than the market expectation, this benefited bond prices, and therefore mortgage rates. Since mid-November we’ve been talking about how; unless we got surprisingly bad news on inflation in the months ahead, it looks like mortgage rates peaked that first week in November. Today’s CPI data coming in right at expectations further reinforces this trend. To put into perspective, the 10 yr Treasury, which is what Jumbo mortgage rates follow, hit ~4.35% that last week of October, then had it’s best day of the year the same day the November CPI report came in lower than expectations, then again moved another leg lower after the December CPI data, and is settled in today at ~3.4%. This is significant good news as we all know higher mortgage rates are part of the downward pressure on real estate prices, and vice versa.
We’re still seeing Jumbo rates today a bit lower than conforming, and the larger loan amounts actually pricing the best. For example today, a ~$2.0M purchase with 20% down, can get a 30 yr fix in the 5%’s with no points, and as low as ~5.25% with a little over a point. This is a historically healthy place for mortgage rates to be.
In sum, the headlines will soon again talk about rates moving higher when the Fed increases the Fed Funds rate again, which is coming, and meanwhile mortgage rates have already come down to a healthy level.