Issue 41. September 11th, 2023

Happy Monday💸 I’m back!

I hope everyone had a great week off from my ramblings. My fantasy football draft went off without a hitch. Already chalking up a 1-0 record as a result.

A bit more than usual to break down this week. The biggest thing (personally) is our Oktoberfest party on Saturday the 23rd. Also is my dad Drew’s 74th birthday! Yes, I know this is short notice!

Details are below, but please email or click here to RSVP. We want a rough total headcount for sausages and beer.

And before any of you smarty pants ask, yes, Oktoberfest is ALWAYS kicked off in September.

Have a wonderful week.

– Glenn T. Groves

TLDR (Too Long Didn’t Read) Summary:

• ↔️ RATES – Holding steady

• 📊 TECHNICALS – Could see a soft landing?

• 🍺🥨 OKTOBERFEST– You’re invited!

  Verify my mortgage eligibility (Oct 3rd, 2023)

• 💡 INDUSTRY – Timing the market

• 🌟 INSPIRATION – Steve Jobs

RATES

Product Rate / APR Weekly Change

↔️ Conventional (Zero Point) 7.375% / 7.341% -.000%

Conventional (One Point) 6.950% / 7.065%

↔️ Conv. HB (Zero Point) 7.625% / 7.635% -.000%

Conv. HB (One Point) 7.250% / 7.368%

⬇️ JUMBO (Zero Point) 7.625% / 7.636% -.375%

JUMBO (One Point) 7.125% / 7.245%

↔️ FHA 3.5% Down (Zero Point) 6.625% / 7.357% –.000%

FHA 3.5% Down (One Point) 6.250% / 7.086%

↔️ VA 0% Down (Zero Point) 6.750% / 6.997% –.000%

VA 0% Down (One Point) 6.375% / 6.723%

Rate data as of morning of publication. Unless noted otherwise, all scenarios are assuming 30 Year Fixed mortgage, Purchase & R/T Refinance. No origination points charged, 780 FICO score, and 20% down payment .Provided for consumer education only and does not serve as a binding offer to extend lending. Payment period, interest rate, APR, and other terms subject to income, asset, and credit profile qualification.

Rates highlighted in this color have the same metrics as above, but would incur one discount point charge.

• 📊 Mortgage Rates: Treading water from my last newsletter on the 28th. No serious movement. I can only anticipate that the markets are waiting for the other shoe to drop, as September is statistically usually the worst month for the stock market. Not a super technical breakdown of why things are happening, just a gut feeling.

  Verify my mortgage eligibility (Oct 3rd, 2023)

TECHNICALS

🛬 Soft Landing?

10Y T Note 09.11.2023

More and more economists are starting to think that the Fed, whether intentional or not, might pull off a soft landing with the economy. The dow
continues to chug upward, and the labor market is cooling.

Seems like they are taking the wait-and-hold approach, which means that mortgage interest rates will continue to fluctuate in the 6-7% range for the short term.

Jerome Powell – Chair of the Federal Reserve of the United States

🏦 Is the Fed Giving Rate Hikes a Break?

• Quick take: Fed speakers hinting they might hit the pause button on rate hikes this month.
• Details:
  • NY President John Williams suggests the current monetary policy is working as intended.
  • Dallas Fed’s Lorie Logan thinks skipping this month’s hike could be the way to go, while Philadelphia Fed’s Patrick Harker believes it might be time to hold steady.
• Bottom Line: 📉 The job market isn’t as rosy as it seems. Monthly job growth is slowing down, and unemployment ticked up from 3.4% to 3.8%. Will this convince the Fed to hold off on rate hikes? Watch out for this week's inflation data!

📈 Hitting New Peaks in Home Price Appreciation

• Quick take: Black Knight's Home Price Index shows home prices are on a steep climb!
• Details:
  • July saw a 1.5% increase from June.
  • Prices are up 2.3% annually. If this continues, we’re looking at a 7.5% annualized pace.
  • Almost every city (99 out of 100) showed gains!
• Bottom Line: 🏠 Forget the housing crash talk! Data from trusted sources like Case-Shiller and CoreLogic shows home values are rising. This is a golden period for wealth-building through homeownership!

📅 The Holiday Effect on Unemployment Claims

• Quick take: Initial Jobless Claims dropped by 13,000, but there’s a catch.
• Details:
  • The drop happened leading up to Labor Day, so the holiday might have affected the numbers.
  • Continuing Claims have been on a decline, but some companies are "quiet cutting" their staff to save money.
• Bottom Line: 📊
  While jobless claims look promising on the surface, underlying factors might paint a different picture.

🔍 What to Keep an Eye on This Week

1. 📌 August’s Consumer Price Index on Wednesday.
2. 📌 Thursday’s Producer Price Index for wholesale inflation
   news.
3. 📌 Tuesday’s report on small business owners’ confidence.
4. 📌 Retail Sales and the latest Jobless Claims on Thursday.
5. 📌 The results of Tuesday’s 10-year Note and Wednesday’s 30-year Bond auctions.

Stay informed, stay ahead, and have a fantastic week! 💼🔑

EVENTS

Join Us at OKTOBERFEST 2023

Please join us with for our annual Oktoberfest!

We have a Toys For Tots toy drive at Creekside Groves each year.

BBQ sausage, music, beer, and great company.

Anyone who has joined us before can attest to how fun these parties are, and they are all in the name of a fantastic cause!

Shoot me an email or click below to RSVP on Facebook. Details above on the flyer.

Last year we have over 200 people swing by and have a blast!!!

INDUSTRY

How To: Time The Market

⏲️ We all know the answer to this: You really cannot time the market. What you can do is understand and teach that home appreciation is constant.

There will be ebbs and flows for rates. Financial, socioeconomic, and political events may all affect rates.

If you have a potential client that is waiting to “time the market,” here are some questions to ask:

• When was the last optimal time to buy?

  • 2011-2012 + 2020-2021 were some of the “best times” to buy over the last 10-13 years, partly because of prices, partly because of VERY cheap money. We will not see either anytime soon, and we cannot accurately predict another window like this. If I could, I would be on a beach somewhere with a fruity drink in my hand.

• How many other people have the same line of thinking as you do?

  Verify my mortgage eligibility (Oct 3rd, 2023)

  • It may be time to Zig when everyone else is Zagging.

• Have you applied your timing logic to the stock market?

  • “Yes” – Fantastic. How much have you made over the years, and how do you anticipate these moves?

    Verify my mortgage eligibility (Oct 3rd, 2023)

  • “No” – Why not? There have been plenty of opportunities to buy simple index funds and make a tidy return over the last decade.

I have mentioned this in the newsletter, but it is always worth repeating. With hindsight and knowing what you know now about the following topics:

• Supply and demand

  Verify my mortgage eligibility (Oct 3rd, 2023)

• Rates

• Inflation

• Housing Prices

  Verify my mortgage eligibility (Oct 3rd, 2023)

“If you could have bought a home five years ago, would you have?

And what will you be asking yourself five years from now?”

INSPIRATION

Book Review

I had the pleasure of finishing the Steve Jobs biography by Walter Isaacson last week (Audible). It was very well written, and I enjoyed it.
I did not realize how big of an asshole Steve Jobs was to his colleagues and employees, lol. But honestly, I could not identify with his ruthless tactics.

There were some fascinating business lessons, trials, and tribulations over the 25-hour-long listen. One of my favorite quotes below especially rang true.

“I’m convinced that about half of what separates the successful entrepreneurs from the nonsuccessful ones is pure perseverance.” – Steve Jobs.

Everyone in the Real Estate and Mortgage space should consider themselves self-employed to some degree. In turn, an entrepreneur has to forge their own path of success, and perseverance is vital. It is easy to quit. The winners will keep up the fight!

Happy house hunting! 🏠💼🎉

P.S. The Elon Musk bio drops tomorrow 9/12, and I am looking forward to that listen too!