James here! I’m speaking this weekend at the Home Design & Remodeling show in Palm Beach, FL. I love opportunities like this. I get to take all that I’ve learned over the past 15 years, and share it with individuals who want to grow in their professional life.

If you are in Florida, check out the link here.

Hope to see you there!

– James

Why today’s market is a paradox

With interest rates through the roof and mortgage applications on the decline, you’d think home prices would be dropping too. Not so fast. According to recent data from Redfin, home price growth has barely slowed, and it shows no major signs of letting up just yet. Experts say that prices haven’t dropped because demand is strong and supply just hasn’t caught up.

Here’s what’s happening in the market:

• Home sales dropped 2% in April and a full 6% YoY

• Meanwhile, the median home price jumped to a record $391,200, up almost 15% YoT

• The average mortgage payment has risen 44% YoY to an all-time high $2,427

• 43%-77% of offers made in the top 36 biggest metros faced at least one competing offer, which drove prices up even further

Our take

At first, this may look like glum news for buyers, but we think this will lead to opportunity. Sellers won’t want to miss out on this market, so they will start listing their homes and creating more inventory. When that happens, it’ll create a more competitive market and force those sellers to lower their prices.

Comparing urban and suburban home prices

In pre-COVID days, urban homes were generally gaining value more quickly than suburban homes. But the pandemic has changed that. Since July 2021, the typical suburban home gained $66,490 in value, compared to $61,671 for the typical urban home.

This means that competition for homes near city centers could be lighter than it’s been in a decade. This doesn’t mean it won’t be extremely competitive, but this could be good news for buyers who are looking for any signs of hope in this market.

Our take

This makes sense to us. We saw so many buyers move to the suburbs to get more space during the pandemic. This shift probably won’t last forever, so now is a good time to check out the pockets in the city that might have the best bang for their buck and reach out to potential buyers.

Why is it so hard to find a good contractor?

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A new way to invest in rentals

Jeff Bezos sees single-family home rentals as a “prime” opportunity. Bezos Expeditions has now made two sizable investments into the startup Arrived Homes. The company buys up rental properties across the country and gives investors the chance to own a piece of the booming rental market for as little as $100. It’s the first SEC-qualified investment platform to offer this opportunity. The company already has 102 properties under management, but it’s planning to buy more with this latest influx of cash.

Our take

This is a great sign for the housing market. It shows the world that, no matter if you’re Jeff Bezos or someone purchasing a home for the first time, people always fall back to brick & mortar. Real estate is still a strong investment, and the best asset when it comes to diversifying your portfolio.

Schematics

The news that just missed the cut

• Michael B Jordan just bought this gorgeous California home

• 32 expert answers to the question, “Is this a bubble?”

• Redfin’s chief economist gives a super honest interview to The Breakfast Club

• The four stages of uninspected homeownership

• Is the Boston real estate market starting to cool?

• Hollywood Reporter released the Top 20 agents of New York

Foundation Plans

Advice from James and David to win the day

If you’re leading a team of rookie agents, setting them up for success can feel daunting. To help you onboard your new agents and get them started on the right foot, use these quick tips:

• Be an ultra-clear goal setter. Make sure every new agent knows exactly what’s expected of them in their first month, quarter, and year. Then do everything you can to help them meet and exceed these goals!

• Find them a mentor. A strong mentor makes all the difference in a new agent’s success. If you know someone who’d be a great professional role model, make the introduction right away.

• Incentivize their little wins. It might be a while before your new agent closes their first deal. Think of ways to incentivize their progress along the way. These little wins will give them confidence and momentum while they’re waiting on the big win (and first big commission check).

• Be patient! Your new agents have jumped into this industry in the middle of a tidal wave. Interest rates are through the roof, demand is off the charts, and anything goes! Now, more than ever, be patient with their learning curve.

Just in Case

Keep the latest industry data in your back pocket with today’s mortgage rates:

Knowledge is the key to success in real estate. Seriously, if you know your local market inside and out, if you know what’s happening nationally on a macro level, and if you know what buyers and sellers are thinking and feeling, you’ve already got 90% of this job figured out. Keep reading and keep learning. We promise you, it’s going to pay off!

– James and David

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