All Encompassing Mortgage and Real Estate Thread

[closetohumping 17803]

9 minutes ago, Chewbacca said:

I grew up in GV.  Don't want to live there now, though.  Traffic is always a mess 

True.  But that's Denver in a nutshell.  At least it's a grid layout compared to the rest of the metro, plus CCHS is right there.

[Chewbacca 7829]

2 minutes ago, closetohumping said:

True.  But that's Denver in a nutshell.  At least it's a grid layout compared to the rest of the metro, plus CCHS is right there.

Yep, I went to CCHS.  Grew up in the neighborhood right behind King Soopers at Belleview and Yosemite.

 

Traffic out where I am now is much better than DTC, especially since I work from home.  A lot more food options over there, though.  It is definitely a nice area, though.

[closetohumping 17803]

Just now, Chewbacca said:

Yep, I went to CCHS.  Grew up in the neighborhood right behind King Soopers at Belleview and Yosemite.

 

Traffic out where I am now is much better than DTC, especially since I work from home.  A lot more food options over there, though.  It is definitely a nice area, though.

Yeah, so for a brief period I lived in the apartments that are across the street and to the left of that Soopers.  There's a Jersey Mike's there that I once got an 18.00 sub from.  Still pissed.  Used to get tanked at the Tavern as well. 

 

I didn't really appreciate Denver until I left.  There's a lot to like about it.  It's very balanced.  

[936horn 942]

Late to the thread here but moved to Denver in early 20. Live in Castle Pines. Happy to answer questions for all you relocaters. We absolutely love living here but it’s even more expensive than it was two years ago. Schools down here are great if that matters to folks. 

[jimmyjazz 47127]

3 hours ago, Wulaw Horn said:

So- this was 10 days ago or so- and now- let me present- for the first time in forever- substantial improvement over a period of time lasting more than 48 Hours!  I'd called a likely top at 6.07% and this had represented good news from there.   Now- here is good news for today:  

That is good news.  Hope it continues.  Long chat with the wife last night, and despite my willingness to hold onto our Austin house, I think we're gonna be looking at selling next spring.  Seems like that might be reasonable if interest rates have peaked and demand is still climbing.  At some point I just have to ensure domestic tranquility.

[mchookem 16765]

so if i started a Texpatriate relocation home search thread...where would it go, here (6th street)? 🤔

[closetohumping 17803]

2 hours ago, mchookem said:

so if i started a Texpatriate relocation home search thread...where would it go, here (6th street)? 🤔

Food and travel 

[FORTY NINE TO ZERO 2651]

my miami beach STR is awesome. thought we (well my wife) bought it out of a bankruptcy during the housing crash.  at the the current rental rate, 4 years of profit will total more than she paid for it. 

wish she had bought more. lol

Edited July 6, 2022 by ONE YARD

[UTPhil2006 3930]

12 hours ago, ONE YARD said:

my miami beach STR is awesome. thought we (well my wife) bought it out of a bankruptcy during the housing crash.  at the the current rental rate, 4 years of profit will total more than she paid for it. 

wish she had bought more. lol

50% off for Surly renters?

[Neonmoon 38130]

12 hours ago, ONE YARD said:

my miami beach STR is awesome. thought we (well my wife) bought it out of a bankruptcy during the housing crash.  at the the current rental rate, 4 years of profit will total more than she paid for it. 

wish she had bought more. lol

 

11 minutes ago, UTPhil2006 said:

50% off for Surly renters?

Or pics of wife?

[Wulaw Horn 19579]

1 hour ago, Neonmoon said:

 

Or pics of wife?

50% off the wife?

[Hefeweizen 5443]

Well it’s official as of yesterday, got the keys to the new house in Pacific Grove, California. 

 

 Shout out to  @Gil Bang who referred me through a friend to a local mortgage banker in Santa Cruz that was nails.  We closed in something like 25 days.  
 

Back into debt slavery of a sort but man, it is an awesome place.  I doubt I’ll ever move again but I don’t know the future.  I am a happy man right now with the combination of great weather, small town life, and small house with no carpets (ever again).  Oh and no bugs here, as long as you don’t count termites which are apparently everywhere.

[chainsaw 10282]

1 hour ago, Hefeweizen said:

Well it’s official as of yesterday, got the keys to the new house in Pacific Grove, California. 

 

 Shout out to  @Gil Bang who referred me through a friend to a local mortgage banker in Santa Cruz that was nails.  We closed in something like 25 days.  
 

Back into debt slavery of a sort but man, it is an awesome place.  I doubt I’ll ever move again but I don’t know the future.  I am a happy man right now with the combination of great weather, small town life, and small house with no carpets (ever again).  Oh and no bugs here, as long as you don’t count termites which are apparently everywhere.

No banana slugs?

[Hefeweizen 5443]

1 hour ago, chainsaw said:

No banana slugs?

They are an awesome mascot.  But no slugs.

[tx 3 putt 78668]

4 hours ago, Hefeweizen said:

Well it’s official as of yesterday, got the keys to the new house in Pacific Grove, California. 

 

 Shout out to  @Gil Bang who referred me through a friend to a local mortgage banker in Santa Cruz that was nails.  We closed in something like 25 days.  
 

Back into debt slavery of a sort but man, it is an awesome place.  I doubt I’ll ever move again but I don’t know the future.  I am a happy man right now with the combination of great weather, small town life, and small house with no carpets (ever again).  Oh and no bugs here, as long as you don’t count termites which are apparently everywhere.

 

hey man congrats !!!

 

and thanks for offering up your spare room to me, the next time im out there vacationing !!!

[UTPhil2006 3930]

On 7/6/2022 at 7:41 PM, tx 3 putt said:

 

hey man congrats !!!

 

and thanks for offering up your spare room to me, the next time im out there vacationing !!!

Get in line.

 

Also, 10 year taking a fall this morning after going up Thursday and Friday so nice to get what we had gained back down.

[Neonmoon 38130]

3 hours ago, UTPhil2006 said:

Get in line.

 

Also, 10 year taking a fall this morning after going up Thursday and Friday so nice to get what we had gained back down.

Good luck everyone!

https://www.usnews.com/news/economy/articles/2022-07-11/inflation-to-dominate-economic-chatter-this-week-with-cpi-report-for-june-weighing-on-markets

 

Quote

 

It’s the 800-pound gorilla of economic reports this week.

On Wednesday, the Labor Department will report the consumer price index for June, with forecasts that it will top the 8.6% rate for annual inflation recorded in May. A run-up in energy prices last month that has since abated is likely to make for an ugly headline number.

The core index, excluding volatile energy and food, could well come in a little cooler, at 5.7% compared to 6% a month earlier as other items are beginning to show some reduction in the rate of their price increases.

 

There will be other important reports this week on retail sales, which serves as a proxy for overall consumer spending, and producer price inflation, often an indicator of what the consumer will face in the coming weeks.

None of the readings is likely to change the story for the Federal Reserve when its monetary policymaking committee meets later this month and will almost certainly raise interest rates. Experts are expecting another 75 basis point hike after a similar increase in June.

 

 

[3adays 454]

[Captainant 28509]

1 hour ago, 3adays said:

Is this saying that 27% of Texas builders accepted a contract, and then cancelled it due to lack of materials or labor?

[Pato del Muerto 53451]

I think it’s borrowers cancelling. 

[Wulaw Horn 19579]

1 minute ago, Pato del Muerto said:

I think it’s borrowers cancelling. 

That’s correct. Builders never cancel for lack of supplies. They just extend out the delivery date. 

[Hefeweizen 5443]

1 minute ago, Wulaw Horn said:

That’s correct. Builders never cancel for lack of supplies. They just extend out the delivery date. 

And then try to raise prices…

John Burns has the best data, they are quality.  That is very concerning news, if it’s a trend.  I’m hearing a lot of rumblings in converting for sale to for rent product.  Good luck with that plan.

[Pato del Muerto 53451]

You have to wonder how many buyers were advised to float the rate that now can’t afford the loan amount, or investors where the monthly value proposition has diminished. 
 

or others who are just speculating that the market has peaked, will dip, and they can get a better sales price down the road at the same or better loan terms. 

[StruggleBus 3922]

So is everyone that's financing right now just crossing their fingers that they can refinance in the next couple years? Seems like the worst time ever for a new mortgage. 

[Neonmoon 38130]

12 minutes ago, StruggleBus said:

So is everyone that's financing right now just crossing their fingers that they can refinance in the next couple years? Seems like the worst time ever for a new mortgage. 

If rates go up, then you lucked out and got a good deal. 

If rates go down, then you refinance into a lower rate. 

Waiting and/or trying to time the market is fear based and counterproductive. It is a bad financial decision. You lose money renting if you're a buyer. You lose equity in new home you want by waiting to sell old home you don't want. 

Yes, there are unicorns that do time the market, but good luck 

[Wulaw Horn 19579]

46 minutes ago, StruggleBus said:

So is everyone that's financing right now just crossing their fingers that they can refinance in the next couple years? Seems like the worst time ever for a new mortgage. 

What neon said. It’s always to your benefit to lock today. If it gets worse congrats on locking. If it gets better you get a new deal down the road. It’s the beauty of a contract that the buyer gets to choose to keep or ditch at their discretion. 

[Neonmoon 38130]

Realtor: Their offer got accepted

Me: Great news!

Realtor: The seller only accepted if they would do owner financing

Me: (screams internally)

 

[ChickenSandwich 9952]

“The buyer will only do owner financing at 3%”

[UTPhil2006 3930]

3 minutes ago, ChickenSandwich said:

“The buyer will only do owner financing at 3%”

13%*

1 hour ago, Wulaw Horn said:

That’s correct. Builders never cancel for lack of supplies. They just extend out the delivery date. 

Lord ain't this the truth as a few on here can attest to.

57 minutes ago, StruggleBus said:

So is everyone that's financing right now just crossing their fingers that they can refinance in the next couple years? Seems like the worst time ever for a new mortgage. 

Seems to be the prevailing thought.  For some rates either priced them out or they had to significantly drop their target amount

35 minutes ago, Neonmoon said:

If rates go up, then you lucked out and got a good deal. 

If rates go down, then you refinance into a lower rate. 

Waiting and/or trying to time the market is fear based and counterproductive. It is a bad financial decision. You lose money renting if you're a buyer. You lose equity in new home you want by waiting to sell old home you don't want. 

Yes, there are unicorns that do time the market, but good luck 

This is correct.  Get everyone in and hope November/Jan 2023 rates get back down.

23 hours ago, UTPhil2006 said:

Get in line.

 

Also, 10 year taking a fall this morning after going up Thursday and Friday so nice to get what we had gained back down.

Another sizable fall today too.  Down .10 yesterday, down .08 today so far.

[closetohumping 17803]

1 hour ago, Wulaw Horn said:

That’s correct. Builders never cancel for lack of supplies. They just extend out the delivery date. 

Not flat cancelling but I did read about some builders renegotiating the price and if the buyer was unwilling, they would cancel.

1 hour ago, Pato del Muerto said:

I think it’s borrowers cancelling. 

Well that's ironic

[closetohumping 17803]

3 hours ago, 3adays said:

Not sure why Texas is so much higher than everyone else?

 

[We’reTexas 1477]

Edit: misread post. 

Edited July 12, 2022 by We’reTexas

[Wulaw Horn 19579]

Rates from yesterday.  We had a good morning today but gave it all back after the 10 year auction came in weak.  Market anxiously awaits inflation report tomorrow.  Looking for a big number (like a jump to 8.8 is what my wizards of smart suggested) tomorrow so anything that's just a terrible 8.5% or something would cause rates to drop, as crazy as that sounds.  

Again- this is not what you'd get if you called me for a rate. I locked a lady today on an FHA at 4.5% paying 3/4 of a point discount rate ($1500 on her $230k loan) up front, but she's 1.11 points ahead of the national average on this chart.  Without the points she would have been at 4.875 on a par rate.  We locked a guy today on a 30 year Conventional at 4.99 paying 0.9% discount points.   Without the discount points he would have been at 5.375%  I almost never advise discount points but there was a reason for both of these guys that they needed to pay them to make sense. so, as always, this isn't a quote- your situation I'm sure differs from average, blah blah blah. 

 

30-YR. CONFORMING

5.808% -0.021

30-YR. JUMBO

5.319% +0.050

30-YR. FHA

5.615% -0.038

30-YR. VA

5.354% -0.042

30-YR. USDA

5.573% -0.026

15-YR. CONFORMING

4.764% -0.040

[jimmyjazz 47127]

6 hours ago, StruggleBus said:

So is everyone that's financing right now just crossing their fingers that they can refinance in the next couple years? Seems like the worst time ever for a new mortgage. 

LOL.  5% is hardly an historically high mortgage rate.  Admittedly, prices are also at an all-time high, but buyers knew that last year.  It's the rate that is stifling deals, and I'm unconvinced it will continue to rise much more.

[UTPhil2006 3930]

And we've improved a good bit on rates from about 6 weeks ago.

[Wulaw Horn 19579]

3 minutes ago, UTPhil2006 said:

And we've improved a good bit on rates from about 6 weeks ago.

About a quarter.  The highest I ever posted on one of those charts for the 30 year fixed was 6.08 I believe.  It's at 5.81 right now.  That's 1/4 of a point off highs.  Last week we were probably 4/10ths of a point off those highs.  I think it has a 4 on it by the end of the year, no later than the end of the first quarter next year.  

[Chewbacca 7829]

7 hours ago, StruggleBus said:

So is everyone that's financing right now just crossing their fingers that they can refinance in the next couple years? Seems like the worst time ever for a new mortgage. 

My first mortgage was just over 7%.  Even today's rates are not terrible historically.

[UTPhil2006 3930]

4 minutes ago, Chewbacca said:

My first mortgage was just over 7%.  Even today's rates are not terrible historically.

Yeah they are below where they were when I started in 2008

[Wulaw Horn 19579]

12 minutes ago, Chewbacca said:

My first mortgage was just over 7%.  Even today's rates are not terrible historically.

It's the worst rates have been in 14 years I believe, so that sucks in a perception standpoint, which matters a lot to borrowers in how they feel about their transaction. 

If this is transient, like I believe it is, until we start to get a handle on inflation then they will bump back down and everyone that bought this year will refinance next year.  Such is life. As a guy in the industry what sucks is that when they bounce this high and this fast it just completely dries refinance activity up- even for people looking to cash out or get out of PMI by converting from FHA to Conventional or something like that b/c of how quick the move was.  When I started mortgage at 5% there were more refinance opportunities than there are right now at 5% just b/c we weren't coming off 2.75%, which is what's putting a lot of people out of business.  Such is life.  When I started in the real estate business in 2002 and was signing people up that were giddy on 6.75% refinances you would have worked hard to convince me or them that there would be a day they turned their nose up at 5.75% and were disgusted by it.  
We compare ourselves to those that got the best deal and not to the worst when we are keeping score in our head, and perception matters as much as math for lots of people financially.

[Mach 1 1677]

I’m developing a townhouse project in Phoenix and here now (and sweating my balls off).

Broker was kicking ass on presales and we’re only halfway through framing. He was working on 8 contracts when rates started increasing  - he’s now working on zero.

Seems as if most buyers are in a wait and see mode, which is understandable and fine with me since we won’t be finished until April 23. My hope is whatever rate increase tops out before and some stability comes back wherever it ends up.

Phoenix still appears to be an attractive market with job growth, so fingers crossed. We can weather a 10-20% decline in value and still do fine. After that we’ll be revisiting 2010.

Edited July 12, 2022 by Mach 1
“rocketing” not exactly correct

[BLKNSTY 289]

If rates go up, then you lucked out and got a good deal. 
If rates go down, then you refinance into a lower rate. 
Waiting and/or trying to time the market is fear based and counterproductive. It is a bad financial decision. You lose money renting if you're a buyer. You lose equity in new home you want by waiting to sell old home you don't want. 
Yes, there are unicorns that do time the market, but good luck 

I hear you on this Neon but here’s my main disconnect, its tough for justify a 6% rate on a purchase where the purchase price is 50% higher than where it was 2-3 years ago. It’s a bad decision on top of a bad decision, and even if I refinance, I could be upside down on that property pretty quickly. Unless I’m totally wrong, which I admittedly can be. Need to better understand what happens when I refi tho so I have some homework to do.

I know, i know the price is the price and we aren’t building homes at the pace we should so supply won’t be balanced for awhile.

Here’s a question tho, at what point do investors start funneling money into commercial conversions to residential, is that even a thing? Everywhere I look I see commercial space for rent but with some zoning fixes and some capital I think solves that.

[StruggleBus 3922]

10 minutes ago, BLKNSTY said:

I hear you on this Neon but here’s my main disconnect, its tough for justify a 6% rate on a purchase where the purchase price is 50% higher than where it was 2-3 years ago

I’m looking at it the same way. Skyrocketing rates combined with all time high prices has my wife and I in the wait and see boat. 

[Mach 1 1677]

17 minutes ago, BLKNSTY said:

Everywhere I look I see commercial space for rent but with some zoning fixes and some capital I think solves that.

Well those happen to be expensive and possibly difficult propositions depending on the market. It happens but a developer will look at that option vs tried and true ground up residential and the latter usually prevails on the proforma.

 

[Neonmoon 38130]

38 minutes ago, BLKNSTY said:

I hear you on this Neon but here’s my main disconnect, its tough for justify a 6% rate on a purchase where the purchase price is 50% higher than where it was 2-3 years ago. It’s a bad decision on top of a bad decision, and even if I refinance, I could be upside down on that property pretty quickly. Unless I’m totally wrong, which I admittedly can be. Need to better understand what happens when I refi tho so I have some homework to do.

I know, i know the price is the price and we aren’t building homes at the pace we should so supply won’t be balanced for awhile.

Here’s a question tho, at what point do investors start funneling money into commercial conversions to residential, is that even a thing? Everywhere I look I see commercial space for rent but with some zoning fixes and some capital I think solves that.

You answered your own question. We don’t have the supply for a housing bubble, so there is no way home prices will drop 50% to make you underwater, so you can justify the 6%

plus 6% isn’t that high. You can’t compare every year to the lowest rate in the history of interest rates. It would be like me comparing every year to 1981 and saying, well 14% is a pretty good deal. 

 

 

[Wulaw Horn 19579]

1 hour ago, BLKNSTY said:

I hear you on this Neon but here’s my main disconnect, its tough for justify a 6% rate on a purchase where the purchase price is 50% higher than where it was 2-3 years ago. It’s a bad decision on top of a bad decision, and even if I refinance, I could be upside down on that property pretty quickly. Unless I’m totally wrong, which I admittedly can be. Need to better understand what happens when I refi tho so I have some homework to do.

I know, i know the price is the price and we aren’t building homes at the pace we should so supply won’t be balanced for awhile.

Here’s a question tho, at what point do investors start funneling money into commercial conversions to residential, is that even a thing? Everywhere I look I see commercial space for rent but with some zoning fixes and some capital I think solves that.

Investors (both individual and institutional) are already very much in the residential market. Not sure how much there there is on that one. 
you are right- the price and the rate are 2 things that are separate and need to be treated as such. Appreciation (nationwide) is still happening and fundamentally I think it continues to happen. Rate should be inconsequential to purchasing decision bc, as pointed out, that’s the worst rate you will ever have, so if it’s affordable on the day you bought it then it should always be affordable. 
 

the mindset should be buy now (if you can afford) because the harm in getting locks out of the market is way worse than your upside in potentially seeing a 5-10% drop in asset price before you invest. Always always always mitigate risk first and take your worst case scenario off the board before maximizing/hunting upside. 
 

none of this is to say you should buy a house you can’t afford or buy a house if you don’t plan on being in it at least 36 months. 

[closetohumping 17803]

5 hours ago, StruggleBus said:

I’m looking at it the same way. Skyrocketing rates combined with all time high prices has my wife and I in the wait and see boat. 

I think this is where I’m at.  Realtors and brokers can bark at me and say 5.75 is much better than what your parents paid in the 80s ok.  But it’s the worst it’s been since 2010 and prices have never been higher.  I can’t pull the trigger so that you can complete a transaction.   Brokers and realtors have to think about it from the consumers perspective too

[Wulaw Horn 19579]

33 minutes ago, closetohumping said:

I think this is where I’m at.  Realtors and brokers can bark at me and say 5.75 is much better than what your parents paid in the 80s ok.  But it’s the worst it’s been since 2010 and prices have never been higher.  I can’t pull the trigger so that you can complete a transaction.   Brokers and realtors have to think about it from the consumers perspective too

I mean- I never thank about it from anything other than a consumer perspective or how am I going to be able to help anyone. 
But not buying a place you can afford bc of rates just doesn’t make any logical sense unless you think the market is declining price wise. Rates go up and down and you can renegotiate, as you know, bc you’ve already done it when it gets favorable.  But it doesn’t make sense to sit it out because of rates and see that your entry point comes 5% higher on the purchase price next year. 
Again, this all presupposes you like the house and can afford it and have a need for the house etc. 

[jimmyjazz 47127]

If you don't buy, you rent. 

If you think those skyrocketing costs of real estate aren't affecting rent prices, you're a fool. 

At the very least, run some reasonably detailed numbers on rent, mortgage, taxes and tax writeoffs, etc.  Home ownership is probably not as bad as one might think it is right now.

What is almost surely true is that most people need to be thinking about buying a smaller house than they had originally planned on doing.

[We’reTexas 1477]

3 hours ago, Wulaw Horn said:

none of this is to say you should buy a house you can’t afford or buy a house if you don’t plan on being in it at least 36 months. 

I think that’s the disconnect folks were pointing out. The conventional wisdom may be “the best time to buy is now” or “you can always refinance”, but the increase in interest rates has put many homebuyers in a position where they can now only afford a house that may not meet their long term, or even immediate, needs. And of course, folks are going to weary of going house poor while speculating that rates will go down in the future. It just makes the personal calculus more complicated. In my market , a jump from 3% to 6% interest rates raised average monthly mortgage payments $2,100, while the average rent/monthly payment ratio remained around 30-40% (and CA has rent control). It’s not about timing the market, it’s the complication of timing the best personal decision for you. 

[closetohumping 17803]

7 hours ago, Wulaw Horn said:

I mean- I never thank about it from anything other than a consumer perspective or how am I going to be able to help anyone. 
But not buying a place you can afford bc of rates just doesn’t make any logical sense unless you think the market is declining price wise. Rates go up and down and you can renegotiate, as you know, bc you’ve already done it when it gets favorable.  But it doesn’t make sense to sit it out because of rates and see that your entry point comes 5% higher on the purchase price next year. 
Again, this all presupposes you like the house and can afford it and have a need for the house etc. 

I know.  You and it seems like the others in this thread seem to act with integrity. But I’ve just been around some pretty slimy realtors and mortgage folks.  Educate us yes.  We’re frustrating to deal with?  Can we be fickle?  Sure.  
 

but I will agree that generally if you need a home and can afford one, buy it even if it’s not your dream home.  

7 hours ago, jimmyjazz said:

If you don't buy, you rent. 

If you think those skyrocketing costs of real estate aren't affecting rent prices, you're a fool. 

At the very least, run some reasonably detailed numbers on rent, mortgage, taxes and tax writeoffs, etc.  Home ownership is probably not as bad as one might think it is right now.

What is almost surely true is that most people need to be thinking about buying a smaller house than they had originally planned on doing.

My #1 reason for buying.  Rent buys you time but how often does it save you money.  Let’s say your budget is 500k and the market might dip 10%?  Rent on a 3 br house is probably 2500 these days?  How much are you really saving? I guess the argument could be well”I could save for a larger down payment”.   I’d have to look at the specific numbers but if it’s close, I’m buying