Posted by: msundermier | June 28, 2022

Summer Breeze, Makes Me Feel….

I’m forecasting falling home values, and this summer breeze on the cooling market should make buyers feel fine!

My oh my, a lot can change in a few months.  At the beginning of the year, home prices were rising at an unsustainable 4% per month and selling faster than ever before.  And then a war broke out!  Needless to say, Russia’s war sent shockwaves around the world & we’ve all been impacted by the war’s economic ripple effects (gas prices, food costs, interest rates, etc).

The typical red-hot summer real estate market has changed too.  Sellers have watched buyers become more hesitant due to the fastest rise in mortgage rates since the early 80s.  

As a result, 30% fewer home sales have occurred this month compared to the same time frame in 2021.  This significant decrease in volume will force motivated sellers to drop their prices to attract a buyer, and eventually this momentum should lead to declining home values by summer’s end.

Homes on the market are up; homes actually selling are down. But both are approaching normal, pre-pandemic levels

Some may read those figures and suggest this post’s musical title be changed to “Cruel Summer” or “Summertime Sadness.” But they would be wrong.  Rather, this cooling “Summer Breeze” is simply returning the market metrics to pre-pandemic levels.  We are approaching 7,000 homes for sale in the Sacramento market, a similar amount we saw in the spring of 2020.  This equates to 2 months of housing inventory on the market, again a comparable figure seen before the pandemic.

For some, this market slowdown is wonderful news!  A more balanced, normal market will lead to more opportunities for first-time buyers.  With younger Millennials now hitting their late 20s/early 30s, there are literally millions of them looking to purchase their first home.  This will help soften the fall for home prices, particularly for lower priced homes.

If you have been considering a home purchase, now is the time to get prepared for buying opportunities!  You have more options, sellers are more eager, and prices are no longer increasing.  Give me a call to discuss ways to best capitalize in today’s market as a home buyer.

Posted by: msundermier | April 11, 2022

Babies & Businesses – Oh, How They Grow!

My son turns 10 this year.  Its incredible to think of how much he’s grown and learned in such a short time.  While he still needs lots of attention, love and discipline, he’s a far cry from the helpless newborn of 2012.

THEN…

& NOW!

The same can be said for Blue Waters Mortgage & Real Estate Group, which also turned 10 just this month.  We were a bit insane to birth both a baby and a business in the same year!  But that’s for another blog post.  

Since that exciting “I’ve Started My Own Business!” announcement, The Blue Waters Group has grown from a start-up with 1 part-time employee to a company of 10 experienced, caring professionals.  But just like Oliver, we still need help from the folks that care about us…that’s YOU!

THEN…

& NOW!

My son’s teachers often speak to how 10 is an age of transition.  You’re old enough to begin grasping the complex world around you, but you still need the help of loved ones to find your way in it.  The Blue Waters Group is in a similar phase of transition; we are here to stay, grow & serve our community, but we still need the referrals and repeat business from our cherished clients to do it. 

Today’s real estate market is a tough one to navigate, and folks need the help from a trusted, seasoned professional.  Please pass along my name to anyone you know who may benefit from our real estate and mortgage services when buying, selling or refinancing.  You doing so is vital to our continued growth & success.

Here’s to turning 10!  May the next decade be just as fulfilling and exciting as the last!

10 YEARS AND COUNTING!!!
Posted by: msundermier | March 18, 2022

The Fed Raised Rates. Now What??!!

You probably noticed recent news articles that went something like this…

“For the first time in 3 years, The Fed raises interest rates!!!”

This headline gets overly-simplified and makes the reader believe that ALL interest rates, including mortgage rates, increased overnight because of the government.  That is simply not true.  In fact, mortgage rates LOWERED slightly immediately after The Fed’s recent rate rise announcement.  Let me paint a more accurate picture.

The Federal Reserve Board (aka- The Fed) has direct control over a single rate, The Federal Funds Rate.  Some types of loans are indeed coupled to this rate, so The Fed’s decisions have a direct impact on these loans.  But fixed rate mortgages ARE NOT one of these types of loans.  Mortgage rates move not based on government decisions, but rather by open-market supply & demand.

Below is a graph that shows both the Federal Funds rate (the blue line) and 30-yr fixed rate (the gray line) over the last 5 years. You can see there is no direct correlation.  Surely, in 2019 they both were generally declining, but not at the same time nor pace. 

As in most things, open market dynamics force changes more quickly than bureaucratic decisions.  The chart shows the gray line’s peaks and valleys all pre-date the blue’s, with the exception of The Fed’s decision to plummet the Federal Funds Rate to nearly 0% at the onset of the Covid-19 pandemic. With the Fed’s rate finally rising, it doesn’t necessarily mean mortgage rates will continue to rise along with it. Perhaps mortgage rates have already hit their peak??

Here’s the takeaway…last week’s headlines of rising rates are old news for mortgages, and don’t ever assume that mortgage rates will change due to a Fed rate change.  Actually, mortgage rates have slightly improved since The Fed’s recent rate increase!

30-yr rates are now over 4%, so where do they go from here?  Much of that answer depends on the war in Ukraine, the cost of gas at the pump, and evolving expectations of this year’s mid-term elections.  Good luck correctly predicting the outcome of those story lines!!!

But, I will leave you with one more graph to consider as potentially a glimpse into the future.  Below is an illustration that shows the difference in interest rates from long-term to short-term US government bonds.  When the short-term bond has a higher rate than a long-term bond (a very unlikely event), the line’s chart goes into the pink negative territory.  Economists call that an “inverted yield curve,” and this financial anomaly has taken place before every US economic recession over the last 60 years. 

Presently, the difference from long to short term bond rates precariously sits at only +.2%, and has been falling in recent weeks.  If this figure indeed becomes negative and an inverted yield curve is realized, it could foreshadow an economy headed for a recession.  Mortgage rates nearly always fall during recessions, so its conceivable we will see lower mortgage rates in the near future.  Stay tuned, and thanks as always for reading!

Posted by: msundermier | February 14, 2022

Becoming One IN A Million (or 1,559,537 to be exact)

In today’s hot real estate market, scant sellers are being courted by ravenous buyers.  Homes are selling fast, appreciating even faster, and becoming the largest source of net worth for the average home owner. 

Every seller is feeling like a one-IN-a-million these days, but real estate agents are simply feeling like one-OF-a-million as more new folks have entered the industry. At the end of 2021, there were 1,559,537 members of the National Association of Realtors (NAR), a new record.  Google recently shared that “real estate agent” was the most popular “how to become” search in all of 2021!

As a 20-yr practitioner in this competitive industry, I have seen the ebbs and flows of new agents coincide with the direction of the market.  As such, there are more options than ever when choosing a real estate professional in today’s booming market.  I’ve previously written about how honoring it is when clients choose to do business with us over the countless other alternatives.

It can be tough to stand out in a crowd, but I have differentiated my practice to be one-of-a-kind.  Keep these facets of my business in mind when considering returning to or referring us in the future.  I confidently believe we are not simply one OF a million, but rather one IN a million and offer you the highest level of value possible.

One-Stop-Shop – Nearly no other brokerage in the area offers both real estate sales and mortgage broker services from the same small group of professionals.  Knowing both sides of the industry allow us to give a unique and holistic perspective to your needs.

Ownership –Operating & owning a small business is no cake-walk, but it does allow me to be nimble when it comes to helping you.  When I see an opportunity to change our firm to better serve you, I can swiftly put those changes in place.  Its good to be the boss!

Local & Approachable – Running a business in the city I grew up in means I have a reputation to uphold.  I treat clients like family (did you read my recent Yo Mama post?) & aim to keep earning your trust like my life depends on it…because it does!

Teamwork – As they say, to truly master a skill, you have to teach it.  Leading a team requires I understand the ever-evolving market, showcase an inspiring work ethic, and employ the newest industry tools; all things that translate to also being a better professional for you.  And working with our amazing team means you get the talents of all of us!

Earn Accolades and Reviews – This month I was recognized as a Five-Star Professional for the 11th year in a row.  Many others also earned this distinction, but I am the only one in the Sacramento region to earn that distinction both as a Mortgage Broker and a Real Estate Agent.  More importantly, I’ve been able to earn over 100 raving reviews in recent years that show my commitment to my craft and to my clients.

There is presently a swarm of agents in our field, but we’ve worked very hard to make sure you can still pick us out in the crowd.  We will remain diligently prepared to work with you and those you care about, regardless of the market conditions or the trendy fads our industry creates.

Posted by: msundermier | January 14, 2022

If You’re 55+, 19 Is Your New Favorite Number!

Proposition 19, which became law in 2021, can save homeowners aged 55+ thousands of dollars in property taxes on their next move. Why don’t more folks know about this? I’m here to change that!

Generally, Californians who relocate are subject to higher property taxes on their new home. There were exceptions to this, but they limited where someone could move and how expensive of a home they could purchase. As such, many older homeowners over the years have decided to remain in their old homes to avoid tax increases even if their home was too big or no longer where they wanted to reside. In November 2020, voters passed Proposition 19 that opened up property tax reassessment exclusions for nearly all circumstances where someone 55 and over moves within California.

This is a big deal, yet has gone largely unnoticed since it became law nearly a year ago. The CA Association of REALTORS (CAR) put together a YouTube video highlighting the new law’s benefits, and although there are over 6 million CA residents aged over 55, the video has received only 2,000 views. 

I’m here to shed light on this new law and the opportunities it creates. Lets consider a likely scenario to point out the potential of Proposition 19…

Consider someone who lives in the same home they bought back in the early 80s where they raised their family.  As such, they are now empty nesters & have a low annual property tax bill of $3000.  There are a number factors that could instigate a move.  Perhaps the home is too big for their needs, or the huge backyard and pool become too much of a hassle to maintain, or they want to move closer to the coast & enjoy cooler temperatures during their golden years.  There are many reasons for retirees to relocate.

If they sell their $800,000 tract home & move near the coast to a $1,000,000 cottage on a small lot, then under typical property tax rules their annual bill would soar to well over $10,000.  Yikes!  Quite a cost increase to bear during retirement.  But, thanks to Proposition 19, a simple one-page application would keep their actual tax bill closer to $5,000.  Here’s how it works (somewhat simplified for illustrative purposes; click here for a more detailed breakdown from the legal department of CAR):

Existing Tax Bill +Difference in old home &
new home value
x1% =New Tax Bill
( $3,000 )+($1,000,000 – $800K = $200K)x1%( $2,000 )=$5,000

In this hypothetical, but very believable, scenario of an older homeowner moving to different county and to a more expensive home, $5,000 of property tax savings are realized every year that wasn’t possible before Proposition 19!

If you or your parent/grandparent has been considering a move within California to be closer to family, medical care, better weather, or any myriad of reasons, then have them get in touch with me to discuss how Proposition 19 can open new tax-saving opportunities.  The savings could be the difference between making the move a high-priced dream and an affordable reality.

Posted by: msundermier | November 24, 2021

Yo Mama Is SO Important…

Your Mom’s real estate affairs are no joking matter! 

Yo Mama is so important…you only want the best people helping her.  From doctors to mechanics to financial planners, she deserves the best.  That’s why I’m honored to have received many recent referrals to help several client’s moms with one of the most important financial moves of her life.

Asking to help those that mean the most to you is the highest compliment I can receive.  I am elated to see this growing referral trend in my practice & I hope you keep my team and me in mind this holiday season if family discussions come up about buying or selling a home in the new year.

“It has been a long time since she’s sold a house so she’s nervous about the process,” Burke told me earlier this year about his mom’s upcoming home sale. “And she’s my mother so I only want the best for her which is why I thought of you.”

This was the beginning of a conversation I had earlier this year with a client.  I went on to help Mom sell her home for well more than what she thought possible, which allowed her to best prepare for retirement in the coming years.  Just as importantly, I was able to keep the transaction stress-free and simple.  After the sale, she said “keeping me informed each step along the way” was what she valued most about my services. 

Another family was concerned that Mom’s house was too cluttered & not in good enough condition to sell, but her finances and health prevented any significant repairs to be done.  After my initial consult, I advised the family to save their cash and instead move Mom out so I could make due with the home’s current condition.  After Mom moved out, we successfully marketed & sold the home for over-asking price in a short period of time.  George, her son-in-law, said afterwards “I always knew I would get not just honest but forthcoming information and he didn’t treat us like we knew nothing about real estate even though he was the expert.”  And with the home vacant and an overdue cleaning completed, “the photographs were fantastic!”

Over the last 20 years practicing real estate, I’ve learned that every transaction is emotionally “charged,” but often in varying ways.  Specifically, last-time home sellers such these parents often approach a sale with fear, uncertainty, and procrastination.  Providing them with a trustworthy advisor can diffuse these feelings, and allows them to make good decisions for their future.   After helping Doralyn make a complicated move out of the area this summer, she shared “Matt’s guidance…was invaluable. He was on all the details all the time. I have full trust in Matt.”

My simple approach to all of these transactions was the same: treat your mama as if she was my own mama.  I promise to be patient, thorough, honest and supportive.  Mamas are too important to treat any other way.

Happy Thanksgiving to you all, and Happiest of Birthdays today my own Mama!  Love you, Mom!!!

Posted by: msundermier | July 16, 2021

Its time to get your Refi ON!!!

Last year I posted a ton about mortgage rates and refinance opportunities. This year to date I’ve been rather silent, largely because rates have trended higher and unfair government-imposed fees on refinance loans made them less attractive.  But that’s yesterday’s news!  Today its time to jump for joy and proclaim that mortgage rates are as low today as they have EVER been!!!

For starters, market conditions in recent weeks have been more favorable for mortgage rates.  Initial fears of widespread inflation have subsided, which has allowed mortgage rates to drop.  Furthermore, today the Federal Housing Finance Authority (FHFA) rescinded a fee applied last autumn that added a .5% charge to nearly all refinance transactions.  This is pleasant, unexpected, and well-needed news. 

Here’s a brief history lesson on the matter: the prior FHFA regime (under director Mark Calabria, appointee of former President Trump) suddenly and unilaterally imposed this fee in August 2020 under the guise of increased risk and costs associated with buying mortgages during the pandemic.  In reality, it was a good ‘ol fashion money-grab by the US government.  As soon as the law allowed (literally, a supreme court case was decided on the same day granting authority for removal from office), President Biden appointed current director Sandra L Thompson to replace Mr Calabria.  Within 30 days of taking her position, the Agency has removed this unnecessary fee for American homeowners. 

This means mortgage rates are at record lows!!!  Like crazy low.  Like 30-yr rates well under 3% & 15-yr rates near 2% low!!!  If you haven’t refinanced in the last 12 months, we should chat ASAP. Or, if you’re looking to take cash-out for home improvements or debt consolidation, its never been cheaper to borrow money from your home.  Tell your friends. Tell your family.  Lets collectively shout this news from the figurative roof-tops to help all homeowners save money!

I know the world is starting to get back to normal (for the moment) and that there are more fun things to do in the middle of summer than apply for a refinance. But, I would recommend you take a few minutes to call me soon to crunch some numbers and see how these developments can help you save money every month.

Posted by: msundermier | January 5, 2021

Do You Want Red or Blue Peaches?

Today’s Runoff Elections in Georgia will determine which political party holds majority power in the US Senate.  The outcome will shape the national political landscape for the next two years, and could have a significant impact on mortgage rates over the next few days.

Watching The Peach State’s election results is important for all of us in the financial markets.  If Georgia “turns blue,” meaning both Senate seats are won by Democrats, it will shift the balance of power of the national government and set the stage for sweeping changes for not just politics, but for finances as well.

There’s obviously no such thing as a red or blue peach, but all eyes will be on The Peach State this week to see if it “turns” blue.

Two Senate seats are up for grabs in Georgia.  Presently, Republicans hold 50 US Senate posts while Democrats hold 48.  If the Democratic nominees win both Georgia Senate positions, both parties will hold 50 seats, allowing for Vice-President Kamala Harris to hold tie-breaker voting rights.  With politics sadly so polarized along party lines, this will allow for Democrats within the Senate to hold a majority and influence policy proposals.

This is of interest to the mortgage market because there are several political agenda items that are much likely to become law if Democrats control the US Senate.  Most notably, a larger stimulus package to combat the economic struggles of the Covid-19 pandemic will likely pass.  This federal financial aid will be paid for by selling government bonds, and when this is done at a large scale it tends to push mortgage rates higher. 

There are obviously other complexities and uncertainties surrounding the direction of our nation’s political and financial arenas, but if you’re considering a refinance in the near future here is the take-home message: a “Blue” Senate means upwards pressure on rates.  As the news headlines of the coming days begin to report Georgia’s election results keep an eye on if both elections are led by Democrats.  You may not want to wait to see the results come in; a safer move would be to get a refinance application in ASAP to lock in a rate before the markets adjust.  Its no guarantee rates will rise in the coming days, but mortgage rates presently have never been lower.  Let me help you take advantage of the current market conditions before they potentially change. 

Posted by: msundermier | October 26, 2020

How Do You Show Your Support?

Our country’s election is next week, and it has most of us filled with emotion.  The emotions & opinions vary but they, like the stakes, are high.  I encourage you to get out (or mail in!) to VOTE!

I have a good friend, Justin Raithel, running for Folsom City Council.  If you live in Folsom please strongly consider voting for him.  He currently serves as Folsom’s Planning Commission Chair and was recently recognized as Folsom’s Volunteer of the Year by the Chamber of Commerce. Justin would be a great addition to Folsom’s City Council! 

Let me help you take a look at Justin’s campaign!

I’ve been looking for ways to support Justin in his campaign, as I want to honor his tremendous courage to run for public office.  Justin will likely need to gain 25% of citizen’s votes in order to secure one of the two open City Council seats.  While hitting that mark means Justin will win and earn more votes than the other candidates, it also means 75% of voters didn’t believe in him.  Ouch, right??!! Even if he wins the election, 3 out of 4 people didn’t vote for him.

When I have a friend take on a risky endeavor, like running for office or starting a band, I often throw my family’s full support behind them.  While I’ve never done either, I too know the reality of winning while not having everyone’s support. 

As a small business owner in a very competitive industry, I’m always on the “campaign trail.”  A big part of my career is tirelessly showing why folks can trust me as their capable REALTOR or mortgage broker over the countless other “candidates” in our marketplace.  Thanks to you, we’ve done more business than ever this year, largely through repeat and referral business.  I am forever grateful for the confidence so many of you have in my team and me to help you through your real estate endeavors. 

Despite crushing every metric we’ve ever set for The Blue Waters Group, I still feel the sting when realizing we don’t get everyone’s “vote” of confidence.  Folks choose to do business with other REALTORS, with the big banks out of state and community credit unions down the street.  The old adage says there’s plenty of business for everyone, and that’s true!  But, as a small business owner, my goals have always looked beyond the bottom line. I constantly strive to be the professional in my hometown that can be trusted by my neighbors, by the parents of my kids’ friends, by the folks who I run into at the grocery store.  If I can’t live up to that measure, then the money doesn’t mean much.

I share this with you to remind you how much it means to me when you refer your friends and family and when you come back for your next transaction.  Sure, your business helps me to make payroll with my employees and put food on the table with my family. But you’re also fueling the very ethos of what I’m about, which is “earning your trust is far more important than simply getting your business.” Thank you for how you’ve shown your support over the years.

In similar fashion, I’m showing my support for Justin Raithel because he’s earned my trust.  He is not running for City Council for the simple sake of winning an election.  Justin wants to serve our city because he has the experience, the smarts and the heart to do it better than anyone else.  I’d like to think the same could be said for me as your trusted mortgage and real estate professional.

Posted by: msundermier | September 14, 2020

Mortgage Rates Are On Sale…But Not For Long!

Last month I covered an announcement by the Federal Housing Finance Authority that was going to make refinance loans significantly more expensive.  Essentially overnight, closing costs increased by ½% of the refinanced loan amount for applications not yet locked due to this “Adverse Market Fee.” 

This would have been similar to deciding to buy expensive item at a store with an advertised price on the shelf, and then having the price change while you’re in the check-out line! 

If that happened to you, you’d be upset & probably ask to speak with the store manager! Many mortgage and finance stakeholders did just that, and lobbied to the director of the FHFA to reconsider the surprise fee.  While the fee was not reversed, the FHFA recently announced a delay to the implementation of the Adverse Market Fee until later this year.  As such, there presently is a narrow window to close a refinance application before closing costs skyrocket.

But this window is closing quickly.  Lenders are already starting to announce when they’ll be implementing this Adverse Market Fee.  Some of my lenders have set dates between now and October 5th as the deadline for a loan to be locked to avoid this fee. 

Lots of refinance applications are going to rush through the system in the coming weeks, so its important to get your application in early and follow my “Ready. Aim. LOCK!” plan I detailed in my last blog post.

When you combine the incoming fee increase with the current crazy low interest rates, it makes a compelling case to take action now.  Rarely in our industry do we have a certain forecast as we do now guaranteeing closing costs will be higher in the near future. Rates are literally on sale, but the sale is ending soon!

My wife & I are following my own advice and recently began a refinance application for our mortgage.  I would strongly encourage you to do the same if you have a fixed rate over 3.5%.

Older Posts »

Categories

%d bloggers like this: