January 19th, 2024 9:44 PM by Eric Willner
Radio Show Notes 01/17/24 Wednesday:
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"Debt to Wealth: Navigating the Real Estate Landscape Amidst High Housing Costs"
By Eric Willner, Host of The Real Estate Show, America’s longest running daily radio show about real estate.
Welcome to the Real Estate Show – South Florida’s #1 Real Estate Radio Show and America's longest-running daily radio show about real estate. I am Eric Willner, the Voice of Real Estate and founder of America’s longest-running daily radio show about real estate, as well as the creator of The Automatic Landlord System for Owning Cash Flowing Real Estate “Profitably and Hassle-Free.” This show is a virtual real estate seminar in every episode.
Today is the “Wednesday Midweek Mortgage & Market Report” Edition of The Real Estate Show, where we continue to discuss why NOW is the right time to buy real estate using the theme: "You can turn debt into wealth” in Real Estate.
Did you know that around 26 million Americans have credit scores below 670, considered "fair" or "poor"? This can limit access to affordable loans, housing, and even employment opportunities, creating a cycle of financial disadvantage.
Today’s show is about “You can turn debt into wealth” in Real Estate and how crucial it is to understand this concept for Real Estate Success.
Before we dive in, a reminder of this week’s special FREE Workshops:
Now, let's continue our discussion on why NOW is the time to buy real estate. We will leverage insights from our previous shows and incorporate real estate-related news articles that impact wealth through affordable housing, helping you gain independence and peace of mind. Understanding the news helps you get yourself organized and have a financial edge.
Strategically Placed Calls to Action:
Real Estate News Mortgage Article (From BankRate.com):
Today's national 30-year mortgage interest rate trends
On Wednesday, January 17, 2024, the current average interest rate for a 30-year fixed mortgage is 7.00%, falling 11 basis points since the same time last week. If you're in the market for a mortgage refinance, today's national 30-year fixed refinance interest rate is 7.16%, down 13 basis points over the last seven days.
Article #2
Mortgage Demand Surges 10% On Lower Rates
Key Points:
• The average contract interest rate for 30-year fixed-rate mortgages decreased to 6.75% from 6.81%.
• Applications for a mortgage to purchase a home rose 9% for the week.
• Applications to refinance a home loan increased 11% compared with the previous week.
Another drop in mortgage interest rates caused a run on loans last week. Total mortgage application volume jumped 10.4%, compared with the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($726,200 or less) decreased to 6.75% from 6.81%, with points increasing to 0.62 from 0.61 (including the origination fee) for loans with a 20% down payment. That was the lowest rate in three weeks.
“Mortgage rates declined across all loan types as Treasury yields moved lower last week on incoming inflation data, which helped to support a rise in mortgage applications,” said Joel Kan, vice president and deputy chief economist at the MBA.
Applications for a mortgage to purchase a home rose 9% for the week but were 20% lower than the same week one year ago. Mortgage rates were about half a percentage point (52 basis points) higher one year ago. Buyers, however, appeared to be enticed by the recent drop in rates.
At an open house in Detroit on Saturday, buyers braved the cold and snow to tour a renovated home that had just gone on the market. The four-bedroom, three-bathroom home was listed at $254,500, a little more than half the national median price but more than twice the Detroit median price. Nakita Bell, who is currently renting in Detroit, said the recent drop in rates prompted her to consider buying.
“I know I’m never going to get 4%, but what I don’t want is 9,10, 11 and 12%. It is not a credit card, it’s a house,” said Bell.
Lower rates are also giving some current homeowners an opportunity to save money. Applications to refinance a home loan increased 11% compared with the previous week and were 10% higher than the same week a year ago. While the vast majority of current borrowers have rates lower than those offered today, the recent drop is still having some effect on those whose loans carry higher rates.
Article #3
Why can’t today’s young adults leave the nest? Blame high housing costs
KEY POINTS
· Nearly one-third, or 31%, of Gen Z are living with their parents because they can’t afford to buy or rent their own space, according to a recent report.
· The year 2023 was the least affordable home buying year in more than a decade.
· For parents, supporting grown children can be a substantial drain when their own financial security is at risk. However, there are also economic benefits to living in multigenerational households
In today's real estate landscape, the challenge of housing affordability resonates across all age groups, presenting a significant barrier to independence. However, for young adults navigating the journey towards autonomy, the soaring home prices and steep rents have emerged as formidable obstacles. A recent report by Intuit Credit Karma brings attention to the stark reality that nearly one-third, or 31%, of Generation Z adults find themselves living with their parents due to financial constraints preventing them from affording their own living space. This underscores the urgency of our theme today, "You can turn debt into wealth" in real estate, as we explore ways to empower individuals, particularly the younger generation, to overcome these economic barriers and achieve financial independence through strategic real estate endeavors.
Article #3:
Boomers won’t part with their homes, and that’s a problem for young families
In today's real estate landscape, the theme of turning debt into wealth is exemplified by the challenges faced by young families in the housing market. The article highlights a significant issue: soaring home prices, high rents, and a shortage of homes are making it increasingly difficult for Millennials and Gen Z adults with kids to afford family-sized homes. This obstacle is compounded by Baby Boomers choosing to stay in their larger homes for longer, creating a shortage of available homes for younger generations.
The lock-in effect of low mortgage rates is a contributing factor, as over 90% of current homeowners with mortgages enjoy rates below 6%. Selling and buying another home at the current average rate of 6.6% would mean a higher mortgage rate for most homeowners, discouraging them from selling. This phenomenon is especially evident among Baby Boomers, many of whom own their homes outright, and therefore, the rate lock-in doesn't apply to them.
The article emphasizes that older Americans, particularly Baby Boomers, own a larger share of large homes than they did a decade ago. Young families, on the other hand, own a smaller share, and the trend is not expected to change dramatically in the near future. While some affordability improvements are predicted in 2024 due to declining mortgage rates, the article suggests that a significant influx of housing inventory from older homeowners is unlikely, providing a nuanced perspective on the challenges and dynamics of the current real estate market.
So would-be homebuyers waiting for a so called “Silver Tsunami” of older homeowners selling their homes en masse should not hold their breath, said Bokhari. “Some Boomers are ready to downsize into a condo or move somewhere new for retirement, and the mortgage-rate lock-in effect is starting to ease,” he said. But “there won’t be a flood of inventory. There will be a trickle,” he added.
Thank you, dear listeners, for joining us today on The Real Estate Show, your go-to source for valuable insights into real estate investing. Remember, it's not just about listening; it's about taking action and using our show as a stepping stone to kickstart your journey in real estate investing. We are committed to providing you with a literal seminar in every episode, packed with knowledge, tips, and strategies to guide you on your path to success.
Tune in again tomorrow for our "ATM Edition – About The Money," where we'll delve into the financial aspects of real estate that matter most to you. Don't keep the wealth-building wisdom to yourself – share this show with others who are ready to take ownership of their real estate journey. Together, let's build a community empowered by knowledge and inspired to turn real estate dreams into reality. Thank you for being a part of The Real Estate Show family, and we look forward to having you with us again tomorrow.
Also, you can listen to the entire 30 minute broadcast of any day’s edition of The Real Estate Show by clicking on the audio link on that days summary post. You can also watch the Facebook Live video at www.facebook.com/TheRealEstateShow.
Want to know more? If you are serious about real estate and paying off debt, then find out more on today and every day’s episodes and learn more about Real Estate Investing and learn HOW TO by listening to The Real Estate Show with Eric Willner , Live every weekday morning at 9 o’clock (EST) on Florida’s Money Talk Radio stations WWNN AM1470, FM 95.3 and FM 96.9. You can also hear us on the free apps: iHeart Radio and TuneIn. Recorded Rebroadcasts are available 24/7 on Facebook. Please share this and our Facebook updates.
Eric Willner is the Host and Founder of The Real Estate Show, an informative show about how to buy, own, and improve real estate the right way, on autopilot. - The Automatic Landlord way. (AutomaticLandlord.com) You can reach Eric Willner at Eric@Ericwillner.com or 888-595-7779.
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