The MartiniFactor | last week and this week with real estate and mortgage rates | April 1, 2022 Edition

March 28, 2022 by Kevin Martini

The MartiniFactor provides a glimpse of what happened last week in real estate and in the mortgage arena. In addition, it shares 3 things to keep on the radar for the week ahead.

last week (3/25/2022) & this week (4/1/2022)

LAST WEEK

New Home Sales and Pending Home Sales

If you just look at the headlines and don’t read the full story, it is understandable one could be scared about real estate. Last week reports were released that showed a decline in New Home Sales and Pending Home Sales too – OH MY! It is critical to know the major reason for the decline was not a deceleration of demand but low supply.

Let me get granular on Pending Home Sales, they fell 4.1% in February, which was weaker than expected and comparing February of 2021 to February 2022, Pending Home Sales were down 5.4%. Sure, one could say the decline was caused by higher mortgage rates, but I do not think so. The real story behind the decline is inventory.

The Fed and Raleigh Mortgage Rates

There was a lot of Fed chatter last week. Here is what one needs to know, the Fed has 2 tools on their belt to tighten the economy and they are: 1) increase their benchmark Fed Funds Rate and 2) reduce their balance sheet.

Over time, it is my opinion, the Fed raising the Fed Funds Rate will be a good thing for Raleigh mortgage rates because the Fed should be able to curb inflation and preserve fixed return on mortgage bonds. You see, mortgage rates live in the bond market and inflation is the nemesis to a bond. With inflation in check, Raleigh home loan rates will improve but from a historical perspective, Raleigh mortgage rates are still very low.

As a primer, the Fed purchased $2.9 trillion of mortgage bonds since March 2020. As the Fed plans to reduce it mortgage bond holdings in the coming months it could cause Raleigh mortgage rates to increase.

3 THINGS ON THE MARTINI MORTGAGE GROUP RADAR THIS WEEK

Major Economic Reports on the State of the Jobs Market

The closely-watched jobs report is scheduled for release this Friday (4/1/2022). In addition to looking at the unemployment rate and the number of jobs created in March, the market will closely examine the “average earnings” component of Friday’s jobs report. It’s widely expected that wages will have jumped by roughly 5.5% year-over-year. Meanwhile, the ADP employment report is due for release on Wednesday, and this is often interpreted as a sneak peek into Friday’s official numbers. Also, the JOLTS Job Openings report is due for release on Tuesday and is expected to show over 11 million job openings in the economy, the highest numbers on record.

PCE Inflation Reports

The Fed’s favorite measurement of inflation is the PCE inflation report and we’ll get two perspectives on that this week. On Wednesday, we’ll get the quarterly inflation numbers for Q4 2021, and on Thursday we’ll get the monthly inflation numbers for February. Both reports are expected to show up to 5.5% year-over-year annual consumer inflation.

The Fed’s Reaction

The Federal Reserve indicated in recent weeks it will be removing its pandemic-era stimulus programs and increasing interest rates more aggressively, starting with its monetary policy meeting in May. This caused bond prices to plummet across the entire global bond market with mortgage rates jumping by more than 1% since the beginning of the year according to the Freddie Mac weekly survey of mortgage rates. The volatility is likely to continue as the market continues to react.

The Martini Mortgage Group Bottom Line

Right now, real estate and the current mortgage rate environment remains an opportunity. The Martini Mortgage Group is here to talk about what you have just read and here to help you on the path to buying you home. Contact the Martini Mortgage Group by dialing (919) 238-4934.

Bank Statement Mortgage Program

March 11, 2022 by Kevin Martini

Raleigh mortgage broker Logan Martini with the Martini Mortgage Group offers a bank statement mortgage program to help self-employed borrowers who are in need of an alternate method to show the true cash flow of their business to qualify for a home loan.

It is my opinion that self-employed borrowers are simply not properly represented by mortgage lenders and mortgage brokers in the market place today. Myself and the Martini Mortgage Group may be based in Raleigh but we help credit worthy self-employed borrowers all over North Carolina and in many state in the U.S. who would other wise not qualify for a home loan the traditional way.
Senior Mortgage Strategist, Logan Martini

Martini Mortgage Group Bank Statement Mortgage Program

With the Martini Mortgage Group Bank Statement Mortgage Program a borrower does not need to have 100% ownership in the company to qualify. There are 2 Bank Statement Mortgage options:

a) a 12-month option using business and/or personal bank statements or

b) 24-month option using business and/or personal bank statements.

For either option (e.g. 12-month or 24-month), 2-years of self-employment history is required.

The Bank Statement Mortgage Program can be used for a purchase of a home or a refinance of a current mortgage. The refinance can either be a rate-term refinance or cash-out refinance. The credit score does not need to be perfect either, borrowers with credit scores starting at 600 are eligible. The loan-to-value (LTV) can be up to 90% and the Martini Mortgage Group Bank Statement Program does not carry mortgage Insurance. Oh by the way, the minimum loan amount is $150,000 and the maximum is up to $3,000,000.

To learn more about the Bank Statement Mortgage Program offered by Raleigh mortgage broker Logan Martini, simple call (919) 238-4934.

What people say about working with Raleigh Mortgage Broker Logan Martini

best raleigh mortgage broker logan martini — Google Business Review about Logan Martini

best raleigh mortgage lender logan martini — Google Business Review about Logan Martini

raleigh mortgage lender logan martini — Google Business Review about Logan Martini

The Homebuyers Opportunity This Spring

March 8, 2022 by Kevin Martini

Is there truly an opportunity for homebuyers this spring since we are in a sellers’ market? YES, there is a homebuyer opportunity this spring even with higher mortgage rates, tight inventory, and inflation. Certified Mortgage Advisor Kevin Martini goes beyond the headlines to look at the real homebuyer opportunity this spring in this special episode of the Martini Mortgage Podcast, episode 133 (note: the Martini Mortgage Podcast is available on all streaming services).

If you are a renter and there is nothing wrong with being a renter and there is a time to rent however that time is not now. Rents are rising and the only way one can truly escape rising rents is to consider purchasing a home and secure a fixed rate mortgage to lock in your housing costs.
Certified Mortgage Advisor Kevin Martini in episode 133 of Martini Mortgage Podcast

As a Certified Mortgage Advisor the hot talking points the families I serve have right now is inflation, mortgage rates and concern relating to where home values are headed.
Certified Mortgage Advisor Kevin Martini in episode 133 of Martini Mortgage Podcast

…it is sad that some fear the homebuyer’s opportunity this spring is not existent because of inflation. It seems like today every news article includes the topic of inflation. I understand why, inflation is a real thing, and you may be concerned about inflation as it relates to purchasing a home and you may think it is better to sit on the sidelines because of inflation. Inflation should not stop you from buying a home.
Certified Mortgage Advisor Kevin Martini in episode 133 of Martini Mortgage Podcast

martini mortgage group transcript episode 132 martini mortgage podcast (1)

The Homebuyers Opportunity This Spring Transcript

Are you thinking of buying a home as a first-time homebuyer? Are you a current homeowner however it is likely that soon your current house will not meet your needs or the needs of your family in the future or worse, you have already outgrown your house, or your home has outgrown you! For one that is thinking of buying a home for the first-time, for one who is a repeat homebuyer that is looking to upgrade or for one that is a repeat homebuyer looking to downsize – OH BY THE WAY, downsizing does not mean downgrading – this spring is a great time to take action.

My name is Kevin Martini, and I am a Certified Mortgage Advisor and this is episode 133 of the Martini Mortgage Podcast that I am calling, the homebuyer opportunity this spring.

It is always a great time to explore the benefits homeownership. One can never be too early to explore homeownership options and one can never be too late to explore homeownership options. In case you are wondering, it is a great time right now even in a competitive market like we are in today. If you are a renter and there is nothing wrong with being a renter and there is a time to rent however that time is not now. Rents are rising and the only way one can truly escape rising rents is to consider purchasing a home and secure a fixed rate mortgage to lock in your housing costs.

Yes, I get it, inventory right now is tight and may represent a challenge but, even though the number of homes available for sale is low and could represent challenges, the search is worth it! Whatever way you look at it, homeownership is not just a stable long-term investment, homeownership allows you to lock in your housing costs for the long-term.

I know what you are saying, what about taxes and insurance? Yes, property taxes and homeowner insurance are not fixed costs since they can change from year to year and they may rise but your pure housing payment, which is the biggest portion of your housing expense will remain the same with a fixed rate mortgage.

It is a fact; homeownership can create wealth. Wealth is created by appreciation and wealth is created by the retirement of your mortgage. Listen, if you rent today you are paying for a mortgage, granted you are not paying your mortgage, you are paying your landlords mortgage for them. On the topic of wealth creation, last year the average homeowner gained $56,700 of equity and renters gained nothing.

The pandemic has highlighted that homeownership has not just tangible financial benefits but intangible benefits too! Homeownership has many perks but to me it provides me and my family with security and stability even in turbulent times like we experienced that last couple of years. Homeownership is not just about the dollar and cents however the dollar and cents make sense.

As a Certified Mortgage Advisor the hot talking points the families I serve have right now is inflation, mortgage rates and concern relating to where home values are headed. Let me share what I share with the families I serve, let me start with mortgage rates.

There is no question that today, home loan rates are higher than they were last spring but from a historical perspective, mortgage rates are low and if I may say, mortgage rates are epic today. For crumb sakes, when my wife and I purchased our first home the rate was in the mid 9’s!

In case you are wondering, experts believe that rates later this year will be higher than they are today. Yes, home loan rates are expected to continue to rise and when they do, it will cost you and your family more. Essentially when mortgage rates move upward by 1% your buying power is reduced by 10%. You just have to accept it, your buddy that purchased a home last year got a lower rate than you will today, it is what it is and however the current mortgage rate environment is still very favorable maybe not as favorable as it was but today it is more favorable than the experts are predicting by the end of the year. Here is the Kevin Martini bottom line: mortgage rates are expected to continue to rise and that means in the simplest form, it is going to cost you and your family more to wait to buy a home. If the thought of buying a home this year or maybe next year is beeping on your radar however you are waiting for rates to drop, you will be waiting in a line that is going nowhere and current home loan rate environment will be in the rearview mirror and you will likely say, ‘I wish I took advantage of the mortgage rate environment in the spring of 2022’.

Let me shift gears and talk about home values. I am a Certified Mortgage Advisor and some people call me a mortgage strategist but no one calls me a real estate agent. Since I am not real estate agent, I need to research what leading real estate experts are saying. I look at what CoreLogic, Fannie Mae, Freddie Mac, the Mortgage Bankers Association, the National Association of Realtors and at the Home Price Expectation Survey shares. Not one of these entities believes that home values will be lower in 2022. They all are forecasting that home prices will increase in 2022. Granted home values will likely not increase at same record levels we have seen in the past, but home prices are not going to be retreating. Here is the Kevin Martini bottom line, if you are waiting for home prices to drop because you think homes will be more affordable in a few years you need to know that there is no data that supports this. If homeownership is right for you and your family, you have a remarkable opportunity to get ahead of the curve by purchasing a home before the cost of the home goes higher and cost to ge the mortgage goes higher too!

Finally, it is sad that some fear the homebuyer’s opportunity this spring is not existent because of inflation. It seems like today every news article includes the topic of inflation. I understand why, inflation is a real thing, and you may be concerned about inflation as it relates to purchasing a home and you may think it is better to sit on the sidelines because of inflation. Inflation should not stop you from buying a home. Let me say it again for the people in the back, inflation should not stop you from buying a home if anything it should accelerate your plans.

Here is the Kevin Martini breakdown…

Home prices have been increasing and experts forecast home values will climb through the years ahead. The only way you can protect yourself from higher housing costs is by locking in a historic fixed rate mortgage rate on a home you buy sooner than later. History has shown the best hedge against inflation is a fixed housing costs.

WOW, that was a lot of stuff. If you want more information about what you heard or if you are not sure where to start let me share this fact, the homebuying process starts with the home loan not with the house. Connect with mortgage strategist with the Martini Mortgage Group by calling (919) 238-4934.

It is never too soon to explore your homeownership options…it is never too late to explore your homeownership options either. If homeownership is right for you and your family then know this…the first step is always the loan not the home.

There is never a substitute for having price and cost clarity before you start looking for a home. Get pre-approved before your home search not just pre-qualified! To a seller a pre-qualification says you are just ready and willing whereas a pre-approval with a Certified Mortgage Advisor with the Martini Group says you are ready, willing and able. It also communicates to the seller you are making a ‘same-as-cash’ offer and that is important to share in any market, especially in a tight real estate market like we are in today.

If you want trusted advice with a digital mortgage process that offer a great rate with certainty check out my website by going to: www.MartiniMortgageGroup.com – you can find some real world information there and you can also securely apply online or book an appointment with me.

My name is Kevin Martini and thank you for tuning into episode 133 which has been called; ‘The Homebuyers Opportunity This Spring’

Now it is time for the disclaimer:

This material has been prepared for marketing purposes only. This is not a loan commitment or guarantee of any kind. Loan approval and rate are dependent upon borrower credit, collateral, financial history, and program availability at time of origination. Rates and terms are subject to change without notice. The Martini Mortgage Group at PCL Financial is a division of Celebrity Home Loans, NMLS # 227765 with a Branch address of 507 N Blount St Raleigh, North Carolina 27604. You can contract Certified Mortgage Advisor and Producing Branch Manager, Kevin Martini NMLS# 143962 by calling the Branch and that number is 919.238.4934. For a full list and more licensing information please visit: www.NMLSConsumerAccess.org or by visiting www.MartiniMortgageGroup.com – Equal Housing Lender