Riding the Waves of a Shifting Property Market | Real Estate Market Update w/ Martin

What if we're on the brink of a real estate boom that defies the rising interest rates? Tune in to explore the fascinating dynamics of the current real estate market, where unexpected jumps in pending home sales and fluctuating mortgage rates paint a complex picture. From California's bustling property scene to the strategic negotiations in Minneapolis, discover the forces at play and uncover whether the market favors buyers or sellers right now. Learn about the notable shifts in pending home sales, the intriguing influence of the 10-year treasury yields on mortgage rates, and how these factors could dictate your next real estate decision.

In this episode, we’ll also tackle the ongoing challenges in the commercial real estate sector, especially office spaces grappling with the aftermath of the pandemic and recent banking disruptions. We'll dissect how the shaky employment figures and fluctuating treasury yields impact commercial investments and the recovery of office spaces. Whether you're an investor keen on capitalizing on market shifts or a homeowner aiming to navigate these unpredictable times, our expert insights promise to enhance your real estate strategy. Don’t miss out on the chance to equip yourself with the knowledge and tools to make informed decisions in this ever-evolving landscape.

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Transcript

Speaker 1: 0:00

This just in. Real estate markets across the nation are shifting, and today's numbers might surprise you. Are we on the brink of a boom or are interest rates keeping growth on in check? Whether you're an investor, a homeowner or just watching the trends, you won't want to miss this week's update, because the data is telling a story that could shape your next move. It's October 18th and this is your real estate market update. What if I told you that the commercial real estate market yes, the same one experts are comparing to 2008 crisis is starting to warm up again. Hold on, because I've got some numbers that might change your perspective.

Speaker 1: 0:47

Pending home sales just made their biggest jump since 2021, but the story doesn't end there. The last four weeks ending October 13, pending US home sales spiked 3.2% year over year, the largest increase we've seen in three years. Guys, in 34 out of the 50 most populous metros, sales are up, especially in places like California and Portland Oregon. Why? Well, a dip in mortgage rates to a two-year low at the end of September, sparked by the Fed's anticipated rate cut, laid a key note. But there's more to the picture. The average 30-year fixed mortgage rate climbed again after a strong jobs report on October 4th, hitting 6.32%. With that, home prices also on the rise, posting a 4.7% increase, pushing the typical homebuyer's monthly payment up almost $100 from just a month ago. This is the highest price uptick since March.

Speaker 1: 1:58

Even though buyers initially responded to lower rates, some are now pulling back as rates rise. Mortgage applications dropped seven percent week over week as of october 11th, while redfin's home buyer demand index showed a slight pullback, though still up seven percent from last year. It's a tug of war between buyers and sellers, especially in the Minneapolis where buyers are negotiating heavily to offset these high rates. So is it a buyer's or seller's market, you tell me? Here's what I can tell you this week, as I record this on October 18th the 10-year treasury, as of this morning, actually is 4.096%. Remember, guys, the 10-year treasury is what dictates a 30-year mortgage. That's way up, guys. 4% is way up from that. That's actually what it was at its peak in December 4%. However, the Feds have lowered the interest rates, but remember, what actually dictates the 30-year mortgage is the 10-year treasury, day by day, week by week.

Speaker 1: 3:13

So, while the Feds lowered their rates, we are seeing rates kind of climbing back up because, in my opinion, of this fake job report that they gave us. I do not believe the data that they gave us in this report. That's my opinion. Remember last month when I reported? They reported, actually, that they were off by a million. They overestimated a million close to a million job 890,000 or something like that over what they said it was. So that means they made they were actually a million less jobs created in the US than what they told us. I wonder why we're going into an election Election is happening here in a couple weeks Then, all of a sudden, the unemployment went down. I just don't buy this crap, this nonsense that the government wants to feed us. Those of us that are paying attention, we know better.

Speaker 1: 4:05

While the medium sale price now stands at 384 000 412, up 4.7 percent, the median monthly mortgage payment is at 2 566, an increase from 2 489 last month. But despite these rises, new listings are only up 3.6 percent, the smallest gain ina month showing. Sellers are also hesitant as rates fluctuate. Rates are extremely unstable right now with these um, like I said, with the ten year treasury just just bouncing back and forth. If you're serious about stepping up in your real estate game, whether in commercial properties or building your portfolio, don't go at it alone. Our coaching program gives you the tools, strategies and insider knowledge you need to navigate this market like a pro. Head to wwwmartinreimasterycom and see how you can start building and leveling up today.

Speaker 1: 5:10

Today we're diving deep into the office sector of commercial real estate, an area hit hard by the pandemic and recent bank collapse. Remember when regional banks like First Republic folded in 2023, you guys remember? It sounds like a long, long time ago, but that was just in 2023. That was partly due to their heavy exposure to commercial loans. But there's hope on the horizon and we've got the latest insight straight from Hazim Najee, ceo of Markets and Mellichamp, one of the most respected voices in the industry.

Speaker 1: 5:48

Najee shares that, despite these challenges, both European and American investors are returning to the market. Why? It's simple. As the US employment numbers climb back to pre-pandemic levels and the Fed signals an end to rate hikes, demand for commercial real estate is showing signs of life. But it's not all rosy. Maturing loans in 2024 and 2025 will force many owners to refinance at higher rates. Najeeb explains that lenders, under pressure from the Treasury and the Fed, are working with borrowers to avoid fire sales, and this could be key to stabilizing the market. The market certainly needs this, guys. If there is fire sales, we're going to see. We have seen a softening in the multifamily in the commercial market, but that is a good strategy.

Speaker 1: 6:45

Najee also touched on the elephant in the room remote work. It's here to stay and he doesn't shy away from that reality. But here's a twist he believes the worst is behind us. Many companies are now calling employees back to the office, shifting the narrative from full-time remote to a hybrid model, and while older office buildings may continue to struggle, new and adaptable spaces are finding their place in this evolving market. So is commercial real estate back from the brink? According to Najee, it's not just surviving, it's adapting. Stick around, because we're breaking down how you can ride this next wave of opportunities in real estate investments. And that's a wrap in this week's weekly real estate market update. I'll see you guys next week. Peace out. Are you interested in starting your journey to financial freedom through real estate investing? Check out wwwmartinreimasterycom and let's get you started. Peace.