10 Year Yields Fell Again!

    While mortgage rates are generally holding, 10 Year Treasury yields fell for the third day in a row. I mention this at the top of the blog because this is something we have not seen since May; the reasons include a somewhat benign inflation report and weaker-than-expected employment and manufacturing data.

    Student Loan Payments Are Back!

    I blogged about this in July – Student Loan Moratorium Over = Serious Threat to Economy; What Borrowers With Student Loans Can Do – but am touching on it again, as September is the month that student loan interest resumes, and come October, monthly payments will resume.

    With average payments of $400 per month, this mass onslaught of newly renewed payment obligations will be one more significant drag on the economy (making a recession that much more likely).

    The blog I link to above though sets out a few solutions for concerned borrowers, including Fannie Mae’s willingness to wave its massive “cash out” hit for borrowers taking cash out to pay off student loans.

    Buyer Lost $100,000 Before He Even Bought A Property!

    We have a buyer who is so determined to not overpay for a property that he has been making low-ball offers and getting rejected for almost 3 years!

    He has been through several (very frustrated) agents now and you’d think he’d have learned the folly of his ways, but…no such luck.

    He has been making offers in the $1 million range, and his market has appreciated well over 10% since he started to make offers, despite a small correction last year.

    So, in an effort to save $10,000, he has now effectively lost over $100,000. And sadly, that factor is just making him double down on his low-ball efforts.

    What makes this story even more interesting is that this client is not alone. We have clients like this all the time, and it is why I blog about them often – to hopefully convince future clients to avoid this costly mistake.

    I well understand the pain of overpaying for something, but an obsession with getting the best possible “deal” is often very expensive – particularly in appreciating markets with a tight supply of housing.

    MBS Highway reported this week that all of the major real estate data services are expecting major appreciation this year.

    Case-Shiller: 5% for 2023

    FHFA: 6% for 2023

    CoreLogic: 10% for 2023

    In addition, MBS Highway also cited a survey of economists in which they predicted an average of 18% home price appreciation through 2027.

    If buyers sense that the market is very soft or that depreciation is in the cards, they might want to low-ball and hope for the best – as realistic sellers will accept low-ball offers when supply vastly exceeds demand.

    But, when supply is tight, when multiple offers prevail, and when appreciation is on the horizon, low-ball offers not only go nowhere, they end up being very costly.

    I often blog about the cost of waiting to buy, but the cost of low-balling can be equally costly.

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