1. Give Me Railings!
Open stairs and landings with no railing will almost always be called out by appraisers as a “health and safety” issue that underwriters can’t ignore.
This is a reminder that open stairs (both inside and outside the home) need railings of some sort in most cases. The good news is that the railings do not need to be fancy or appealing.
2. Why Sellers Need Econ 101
Seller: “I don’t care how much the offers are for, I know my house is worth way more…”
Or: “I don’t care what the comps say, my house is worth way more…”
I have heard sellers repeat variants of those statements hundreds of times over the years when they are unable to come to grips with market realities.
If a home is listed for $600,000, and all of the offers are in the $500,000 range – it is probably worth $500,000.
Sellers all too often blame their poor listing agents for not “marketing the property correctly.” Or they attribute far too much value to their improvements, e.g. minor updating, over-the-top remodels, excessive landscaping, unique design choices like fancy wallpaper, garage conversions, unpermitted space, etc.
Sellers often firmly believe that the market is not recognizing/seeing the value of their improvements.
This is a reminder that markets are often far more efficient (where home prices reflect all available information) than most people realize.
So, it’s probably not the listing agent’s fault…
3. “Marry the House, Date the Rate” Was Great Advice!
In 2022 and 2023, when rates suddenly rose, loan officers would tell clients: “Marry the house but date the rate.” It was a reminder that the house was permanent but the rate was not, as rates would likely fall, making a refi very likely.
BUT now that rates have not fallen, many people (including loan officers) are claiming that “marry the house/date the rate” was very poor advice.
Barry Habib with MBS Highway hit this hard today, explaining why the phrase was actually excellent advice.
A. Fixed Payments Vs Rising Rents. Buyers who bought in 2023 locked in their payments and avoided significant rent increases.
B. Appreciation. Buyers have seen their homes appreciate an average of 17% since 2023; that’s $85,000 on a $500,000 purchase.
C. Tax Benefits. Buyers get tax benefits that renters don’t.
D. Inflation hedge. Renowned analyst Lyn Alden repeatedly says “there’s no stopdsszping this train,” referring to our ongoing deficit and spending woes – which in turn implies inflation. And homebuying remains fantastic protection against that inflation.
E. THERE WERE AMPLE REFI OPPORTUNITIES. This is Barry’s primary point, as there have been at least 7 large dips in rates since early 2023. The largest of them was last September. Every time rates dipped, we immediately contacted ALL of our eligible borrowers with refinance opportunities – and convinced them not to wait for “even lower rates.”
I know many LOs, though, who either failed to contact all eligible borrowers or who were unable to convince borrowers not to wait. Those poor borrowers truly did date the wrong rate, or the wrong lender…
