• If you’re wondering what a potential recession could mean for the housing market, here’s what history tells us.
• In four of the last six recessions, home prices actually appreciated, only falling during the early 90s and the housing crash in 2008. Mortgage rates, though, declined during each of the previous recessions.
• If you have questions about buying or selling a home in today’s market, let’s connect.

Some Highlights

• If you’re wondering what a potential recession could mean for the housing market, here’s what history tells us.
• In four of the last six recessions, home prices actually appreciated, only falling during the early 90s and the housing crash in 2008. Mortgage rates, though, declined during each of the previous recessions.
• If you have questions about buying or selling a home in today’s market, let’s connect.

Some Highlights

• If you’re wondering what a potential recession could mean for the housing market, here’s what history tells us.
• In four of the last six recessions, home prices actually appreciated, only falling during the early 90s and the housing crash in 2008. Mortgage rates, though, declined during each of the previous recessions.

“A homeowner who purchased a typical home five years ago would have gained $125,300 from just price appreciation alone.”

Bottom Line

A Recession Doesn’t Mean Falling Home Prices

A Recession Means Falling Mortgage Rates

“Over the past five recessions, mortgage rates have fallen an average of 1.8 percentage points from the peak seen during the recession to the trough. And in many cases, they continued to fall after the fact as it takes some time to turn things around even when the recession is technically over.”

Bottom Line

Why Are More People Becoming Homeowners?

“In the 1970s, when inflation was running around 10%, home prices were rising at approximately the same rate. Renters actually have a harder time in inflationary periods, because rents tend to rise along with inflation, whereas mortgage payments stay the same for homeowners with fixed-rate mortgages.”

Bottom Line

A Need for More Space

A Desire To Be Closer to Loved Ones

“. . . a shifting of priorities has also affected why people are moving. Many companies have moved to permanent remote working policies, giving employees the option to move freely around the country, and people are taking advantage of the perk.”

What Does That Mean for You?

“Your home is your castle and should confer benefits beyond just the numbers.”

Bottom Line

“Homeownership builds financial security. With 65.5% of Americans owning homes, the net worth of a typical homeowner is nearly 40 times the net worth of a non-owner.”

• Your equity (and wealth) grows through home price appreciation.
• Your housing costs are fixed – and that can help combat rising costs from inflation.
• You’ll have greater privacy and the opportunity to customize your living space.

“Living in one place for a longer amount of time creates and [sic] obvious sense of community pride, which may lead to more investment in said community.”

What Does That Mean for You?

“Homeownership remains central to the pursuit of the American Dream. It is a critical driver of economic mobility, delivering financial and social advantages. . . .”

Bottom Line

• Based on a recent Gallup poll, real estate has been rated the best long-term investment for nine years in a row.
• Owning real estate is more than just a place to call home. It’s also an investment in your future. That’s because it’s typically a stable and secure asset that can grow in value over time.
• If you’re ready to buy a home and invest in your future, let’s connect.

Some Highlights

• Based on a recent Gallup poll, real estate has been rated the best long-term investment for nine years in a row.
• Owning real estate is more than just a place to call home. It’s also an investment in your future. That’s because it’s typically a stable and secure asset that can grow in value over time.
• If you’re ready to buy a home and invest in your future, let’s connect.

Some Highlights

• Based on a recent Gallup poll, real estate has been rated the best long-term investment for nine years in a row.
• Owning real estate is more than just a place to call home. It’s also an investment in your future. That’s because it’s typically a stable and secure asset that can grow in value over time.

“New listings–a measure of sellers putting homes up for sale–were up 6% above one year ago. Home sellers in many markets across the country continue to benefit from rising home prices and fast-selling homes. That’s prompted a growing number of homeowners to sell homes this year compared to last, giving home shoppers much needed options.”

Buyer Competition Moderating Helps Inventory Grow Even More

“There has been a pickup in the inventory that we've seen recently, but it's not from a big increase in new listings . . . but rather a slowdown in the pace of sales. And remember that months’ supply measures the inventory of sale relative to the pace of sales. Same inventory, fewer sales, means more months’ supply.”

“As rising inflation and mortgage rates bring U.S. housing demand back from the 2021 frenzy, . . . inventory will grow double-digits over 2021 and offer buyers a better-than-expected chance to find a home.”

How This Impacts You

Bottom Line

Join us today, June 28th at 2:00pm ET to get the insights and answers you need to educate buyers and sellers on the opportunities that still exist in today’s market.

The Gap in Homeownership Rate in America

How Homeownership Impacts Household Wealth 

“The median Black household earns 61 cents for every dollar earned by a comparable White household, according to the Economic Policy Institute. This not only makes it more difficult to afford a home, but also to accumulate and pass on generational wealth.”

“Given that homeownership contributes to wealth accumulation and the homeownership rate is lower in minority groups, data shows that the net worth for these groups is also lower. At $188,200, the net worth of a typical white family was nearly 8 times greater than that of a Black family ($24,100) in 2019.”

Bottom Line

How an Investment in Real Estate Can Benefit You During High Inflation

“Rising rents, which continue to climb at double-digit pace . . . and the prospect of locking in a monthly housing cost in a market with widespread inflation are motivating today’s first-time homebuyers.”

When Inflation Has Risen in the Past, Home Prices Have Too

“There are many advantages to investing in real estate. . . . It often acts as a good inflation hedge since there will always be a demand for homes, regardless of the economic climate, and because as inflation rises, so do property values. . . .”

Bottom Line

• It’s important to understand history proves an economic slowdown does not equal a housing crisis.
• In 4 of the last 6 recessions, home prices actually appreciated. Home prices only fell twice – minimally in the early 90s and then by nearly 20% during the housing crash in 2008.
• If you have questions, let’s connect to discuss why today’s housing market is nothing like 2008.

Some Highlights

• It’s important to understand history proves an economic slowdown does not equal a housing crisis.
• In 4 of the last 6 recessions, home prices actually appreciated. Home prices only fell twice – minimally in the early 90s and then by nearly 20% during the housing crash in 2008.
• If you have questions, let’s connect to discuss why today’s housing market is nothing like 2008.

Some Highlights

• It’s important to understand history proves an economic slowdown does not equal a housing crisis.
• In 4 of the last 6 recessions, home prices actually appreciated. Home prices only fell twice – minimally in the early 90s and then by nearly 20% during the housing crash in 2008.

The Emotional Benefits of Homeownership

Your Home Can Reflect Your Tastes and Personality

“One often-cited benefit of homeownership is the knowledge that you own your little corner of the world.”

“The psychology is that this is yours and you’re going to make it as good as possible because you’re in for a long time, . . . “

It Can Enhance Your Neighborhood and Civic Engagement

“Living in one place for a longer amount of time creates and [sic] obvious sense of community pride, which may lead to more investment in said community.”

The Financial Benefits of Homeownership

It Can Help You Feel Financially Stable

“Building equity through your monthly principal payments and appreciation is a critical part of homeownership that can help you create financial stability.”

It Can Grow Your Wealth

Bottom Line

“The MCAI provides the only standardized quantitative index that is solely focused on mortgage credit. The MCAI is . . . a summary measure which indicates the availability of mortgage credit at a point in time.”

Why Did the Index Get out of Control During the Housing Bubble?

“A credit score tells lenders about your creditworthiness (how likely you are to pay back a loan based on your credit history). It is calculated using the information in your credit reports. FICO® Scores are the standard for credit scores—used by 90% of top lenders.”

Bottom Line

A Little Change Can Bring Lots of Joy

“There were numerous interior projects that received a perfect Joy Score of 10: paint entire interior of home, paint one room of home, add a new home office, hardwood flooring refinish, new wood flooring, closet renovation, insulation upgrade, and attic conversion to living area.”

You’re Free To Update Your Home to Your Heart’s Content

“Your landlord won't always approve changes when you rent. But you have the power to update the home when you're the owner. (Just make sure any big changes are approved by your homeowner's association, if necessary.)”

Bottom Line

What Caused the Housing Crash 15 Years Ago?

1. Many purchasers were not truly qualified for the mortgage they obtained, which led to more homes turning into foreclosures.
2. A number of homeowners cashed in the equity on their homes. When prices dropped, they found themselves in an underwater situation (where the home was worth less than the mortgage on the house). Many of these homeowners walked away from their homes, leading to more foreclosures. This lowered neighboring home values even more.

Why Today’s Real Estate Market Is Different

1. Today, Demand for Homeownership Is Real (Not Artificially Generated)

2. People Are Not Using Their Homes as ATMs Like They Did in the Early 2000s

“Homeowners in Q4 2021 had an average of $307,000 in equity - a historic high.”

Bottom Line

“There are many reasons to buy a smaller home—or to downsize from your present home—but sometimes, the idea that "less is more" is what propels homeowners to buy a smaller home.”

You Can Find the Right Home for Your Needs

Your Equity Can Make a Big Impact When You Downsize

“Home prices rose 18% during 2021 in the CoreLogic Home Price Index, the largest annual gain recorded in its 45-year history, generating a big increase in home equity wealth, . . . For low- and moderate-income homeowners, home equity has historically been a major source of wealth.”

Bottom Line

What That Means for You

“The limited number of homes for sale is a lesson in perspective. This same stat that frustrates would-be homebuyers also means that today’s home sellers enjoy more limited competition than last year’s home sellers.”

Bottom Line

• If you’re a homeowner, your net worth has gotten a big boost. That’s because recent home price appreciation has increased your equity.
• Your equity grows as you pay down your loan and as your home increases in value. Over the past year, the average homeowner’s equity grew by $55,300.
• Ready to sell? Let’s connect to talk about how you can use that equity to fuel your next move.

Some Highlights

• If you’re a homeowner, your net worth has gotten a big boost. That’s because recent home price appreciation has increased your equity.
• Your equity grows as you pay down your loan and as your home increases in value. Over the past year, the average homeowner’s equity grew by $55,300.
• Ready to sell? Let’s connect to talk about how you can use that equity to fuel your next move.

Some Highlights

• If you’re a homeowner, your net worth has gotten a big boost. That’s because recent home price appreciation has increased your equity.
• Your equity grows as you pay down your loan and as your home increases in value. Over the past year, the average homeowner’s equity grew by $55,300.

“. . . We do need price appreciation to slow today (it’s not sustainable over the long run) but high price growth today is supported by fundamentals- short supply, lower rates & demographic demand. And we are in a much different & safer space: better credit quality, low DTI [Debt-To-Income] & tons of equity. Hence, a crash in prices is very unlikely.”

• 2022: 9%
• 2023: 4.74%
• 2024: 3.67%
• 2025: 3.41%
• 2026: 3.57%

What Does This Mean for You as a Buyer?

Bottom Line

Some Highlights

• Due to low supply and high demand, today is one of the strongest sellers’ markets we’ve seen.
• Sellers can benefit from more offers to pick from, higher home values, and a faster sales process. There’s a reason why 72% of people believe it’s a good time to sell.
• Don’t miss out on this unique opportunity. Let’s connect so you can take advantage of this hot sellers’ market.

Exploring Condos Could Add Options That Fit Your Budget

“Condos are generally more affordable because they come with less space — you likely won’t have your own backyard, for example, and the interior tends to be smaller than the square footage of a single-family home.”

Find Out if Condo Living Is Right for You 

“Hate to mow the lawn and trim the hedges? What about pressure washing your driveway? Are your finances such that having to lay out $5,000 or more for a new roof will be a burden? . . . Condos tend to work best for those comfortable with most of the aspects of apartment living, minus the built-in maintenance.”

Bottom Line

“This week, the 30-year fixed-rate mortgage increased by more than a quarter of a percent as mortgage rates across all loan types continued to move up. Rising inflation, escalating geopolitical uncertainty and the Federal Reserve’s actions are driving rates higher and weakening consumers’ purchasing power.”

Where Are Mortgage Rates Going from Here?

Greg McBride, Chief Financial Analyst, Bankrate:

“With inflation figures continuing to surprise to the upside, mortgage rates will remain above 4.0% on the 30-year fixed.”

Nadia Evangelou, Senior Economist and Director of Forecasting, National Association of Realtors (NAR):

“While higher short-term interest rates will push up mortgage rates, I expect some of this impact to be mitigated eventually through lower inflation. Thus, I expect the 30-year fixed mortgage rate to continue to rise, although we aren’t likely to see the big jumps that occurred over the past few weeks.”

Len Kiefer, Deputy Chief Economist, Freddie Mac:

“Mortgage rates are likely to continue to move higher throughout the balance of 2022, although the pace of rate increases is likely to moderate.”

Danielle Hale, Chief Economist, realtor.com:

“. . . As markets digest the Fed’s updated economic projections, I anticipate a continued increase in mortgage rates over the next several months. . . .”

What Does This Mean for You if You’re Looking To Buy a Home?

Bottom Line

"Homeownership is rewarding in so many ways and can serve as a vital component in achieving financial stability."

Owning a Home Is a Building Block for Financial Success

Equity Gains Can Substantially Boost a Homeowner’s Net Worth

“Homeownership has always been an important way to build wealth.”

Bottom Line

“Home prices rose 18% during 2021 in the CoreLogic Home Price Index, the largest annual gain recorded in its 45-year history, generating a big increase in home equity wealth.”

How Rising Equity Impacts You

Bottom Line