New Year, Same Blueprint
Welcome to our first edition of the new year. We are entering this year more fired up than ever, and eager to continue bringing you our takes on all the latest news and information in our industry.
We truly believe every agent could use this information now more than ever. These past few years have been one of the most unpredictable, unprecedented periods in the history of this business. If anything, it proved just how important it is for all agents to stay up to date on the very latest developments.
In our business, everyone is looking to get a leg up on the competition, and we think the best way is knowledge. The more informed you are, the more your clients can trust you to make important decisions that will shape their lives.
So here we go. Let's kick off the first Blueprint edition of 2024!
– James and David
Mortgage rate optimism jumps significantly
San Francisco, CA: https://bit.ly/3PGKVDF
Optimism about mortgage rates increased sharply in December, according to a monthly consumer survey by Fannie Mae. In fact, for the first time in the history of the survey, more homeowners, on net, believe rates will go down instead of up.
This appears to be kickstarting the housing market. As Altos Research reports, the number of sales happening each week is climbing right along with the inventory.
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13% more new contracts were started this first week of January compared to last year
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4.25% more single-family homes are in contract to close YoY
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New listings are up 9% YoY, though inventory is still tight.
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Altos Research anticipates 15% growth in home sales in 2024 over 2023
Our take
We can't tell you how much the housing market will benefit from interest rate cuts and falling mortgage rates. If the Fed follows through on its rate cuts in 2024, we could see a huge improvement in home sales compared to last year. But keep in mind, that it all depends on those rate cuts. We will be keeping a very close eye on all the moves here.
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Latest jobs report makes March rate cut less likely
Last Friday, the Bureau of Labor Statistics released an important jobs report that could have an impact on the Fed’s decision to adjust rates. Here are the key details to know from the December job numbers:
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Firms added 216,000 workers to payrolls, below the 240,000 monthly average for the previous 12 months, but above the 173,000 added in November.
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Unemployment was unchanged at 3.7 percent, signaling relatively good conditions for job searchers.
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There were a combined 71,000 fewer jobs in those months than we previously thought. This continued a downward trend from November, making the labor market look a bit more fragile.
Our take
The jobs stats and the inflation numbers for the next three months are going to be very important. If job numbers remain strong and inflation stays high, then we can expect the Fed to keep rates higher for longer. That will undoubtedly decrease the number of home sales since mortgage rates will remain elevated. The Fed has already indicated that it anticipates making at least three cuts in 2024, but it hasn’t said when it will make those cuts. A lot of market watchers are expecting the first cut to happen in March, but if these reports don’t give us the numbers we need, the Fed might only start making the cuts in May. We’ll have to wait and see.
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The hottest markets for 2024
Sponsored by Homes.com
Zillow just announced its 10 hottest markets for 2024 using the following metrics: projections for local home value growth, the speed at which home listings go under contract, job growth per new home permitted, and the growth in owner-occupied households. Here’s their list:
Our take
As you can see from the list above, five of the top 10 markets for 2024 were in states bordering the Great Lakes. Even though several of these cities have seen above-average appreciation in the past year, they still offer more affordable prices than other markets. On the other end of the spectrum, Zillow expects New Orleans to be the coolest market, with home values declining 6% in 2024.
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Schematics
The news that just missed the cut
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Tracey Kasper resigns as NAR president
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Home insurance costs are getting worse for homeowners
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NAR lost 26,000 members in 2023
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How to increase your conversion rate for online leads
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Inside J-Lo’s new Beverly Hills mansion
Foundation Plans
Advice from James and David to win the day
Welcome to the new year! If you’re a new agent to the business, we’d like to offer you a bit of advice to jump-start your new career as an agent.
Don’t overthink it, take action – Don’t get us wrong. We’re huge believers in intentional planning and goal setting. No agent is going to be a success without it. But sometimes agents spend too much time at their desks instead of out in the field. Are you having a minimum of five real estate conversations per day? Are you making connections through open houses, circle dialing, or FSBOs? Are you increasing your circle of influence by getting to know both potential sellers and buyers? That’s what grows your business the fastest.
Don’t let FOMO lead you astray – Especially if you’re a new agent, don’t compare your success to someone else’s. It’s easy to fall prey to this mentality in our social media age, but it doesn’t make any sense. You’re just starting and have a lot to learn. You can’t compare yourself to a 20-year veteran. Instead of focusing on others, focus on yourself and your business. Are you better than what you were yesterday? Are you hitting your goals? If so, that’s what counts.
Don’t ever let your pipeline go dry – Prepare to hear this a lot from us, because we firmly believe it. We recommend dedicating at least two hours each day to prospecting. It will turbo-boost your pipeline and ensure a steady flow of new opportunities. The more people you contact, the more opportunities you’re going to generate. As an agent, this is going to be your number-one job: get to know as many potential sellers and buyers as possible and then connect them. This is what’s key to building momentum and succeeding in this business.
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Just in Case
Keep the latest industry data in your back pocket with today’s mortgage rates:
Source: Mortgage News Daily
That’s a wrap on this edition of The Blueprint, and happy 2024!
If you’re new to the Blueprint community, we want to hear what you think! What’s your take on today’s stories and tips? Send us a note with your comments, questions, or suggestions.
Thanks for reading, and we’ll see you back here on Friday!
– James and David
