It’s that time of year where one day feels like summer and the next winter. Last week I put away my outdoor furniture, only to want to haul it out just a few days later to enjoy the warm sunshine! And today the forecast was for over an inch of rain and it’s looking like we won’t even get half that. It’s tough to plan with such wild weather swings!
The real estate market is similar at the moment. After an encouraging September where home sales surprisingly increased year-over-year in most parts of the state, October showed disappointing figures. With such inconsistent trends, identifying the vibe of the market is harder than ever. The government shutdown, high cost of living, and unpredictable mortgage rates are all impacting the real estate market in unpredictable ways.
You can read the signs
and still get it wrong!
I have a number of clients hoping to sell their homes in the coming months, and many of them are trying to time the market. They ask me questions like,
“Should I list for sale now before the holidays?”
“Should I wait till Spring?”
“How much more will my home be worth in 2026?”
Just ask me if it’s going to rain on Christmas while you’re at it! In all honesty, timing the market is a lot like timing the weather. You can read the signs, but ultimately its impossible to pull off every time. Here’s a throwback video I shot discussing this analogy.
Even though I’m an expert and live & breath market statistics and trends, I can’t predict the real estate future with any certainty. That’s not what you should expect of me or any real estate professional. What you should expect is help identifying what is most important in your next real estate transaction and navigating through it without losing sight of your priorities. Sellers often get caught up in timing the market that they forget why they are selling in the first place.
I have a client who lives in a home that no longer suits her and the property is bleeding her money in repairs. There are 2 homes that sit on 10 acres and require a lot of upkeep, so this widower recognizes she needs to live in a simpler, low-maintenance home. That is the priority; to change her lifestyle that will improve her health and finances.
But sadly, the quest of maximizing her sales price based on market timing has taken over. And during this quest, she has changed her mind several times, questioned herself, and ultimately is shackled in indecision. All the while, the property expenses are piling up and she loses sleep worrying about what to do. She keeps asking herself “when,” while the most important question she needs to ask herself is “WHY.” Why am I selling my home?
Does this sound familiar to anyone you know? Perhaps your own situation? When toiling over an upcoming home sale, ask me these questions instead:
“What is my home worth right now?”
“Where should I put my focus on improving my home for a sale?”
“Who can help me make this process as easy as possible?”
In short, control your controllables, and most importantly…FIND YOUR WHY. Why are you selling your home? Allow me to help you never lose sight of that.
For the second year in a row, The Blue Waters Group earned the Top Spot as the #1 Best Real Estate Team and inched up to #2 as the Best Mortgage Broker in the Folsom/El Dorado Hills region of Style Magazine’s Readers’ Choice Awards!
These awards are based entirely on votes that come from community members. THANK YOU to our many clients who recognized us with top marks in both our real estate and mortgage services.
Check us out in the October issue of Style Magazine; on newsstands now!
Our track record of earning these distinctive awards as both a Mortgage Broker and Real Estate Team show we are truly a unique business in our region. From helping you find AND finance, buy AND sell, refinance AND invest, The Blue Waters Group is capable of handling ALL of your real estate needs.
I’m sure you’ve heard the news…mortgage rates have finally been falling! But if you’re sitting on a high mortgage rate should you hold off on a refinance until after the upcoming Fed press conference?
Many people expect The Federal Reserve to lower the federal funds rate 1/4-1/2% on September 17th. But what most people misunderstand is this has no bearing on when or even if mortgage rates drop. Mortgage rates have already fallen nearly ½% in the past 30 days due to the same market conditions that are prompting The Fed to cut their rate next week. Mortgage rates don’t wait for Fed policy; mortgage rates change in real time as market conditions change.
Here’s my advice…if your mortgage rate is currently at 7% or above and you have good credit and home equity, look into refinancing now. Don’t get greedy and hope rates get even better next week. It’s worth pointing out that the last time The Fed lowered their rate, mortgage rates actually increased. As the old adage goes, better to take the bird in the hand, instead of two in the bush.
As the chart below illustrates, mortgage rates have not dipped below 6% in the past 3 years. And each time they approach that barrier, they bounce HARD in the other direction, rising 1.0-1.5% in the following months. We are testing that 6.0% barrier again. Will it break through this time? Or get rejected for the third time in three years?
But, if your mortgage rate is already in the 6s and you’re not interested in shortening your term to a 15 yr loan, then “roll the dice.” Sit tight and see if rates fall further. I wouldn’t count on it happening right away, but there’s always that small chance lower rates are on their way.
I’ll be working this weekend and can even lock your refinance rate during after-market hours. Hit me up if you want to explore your refinance options with an experienced & local mortgage broker before the high volatility of next week’s Fed meeting impacts the financial markets.
We’re thrilled to share that we have been nominated again as Best Mortgage Broker and Best Real Estate Team in Style Magazine’s 2025 Best of the Best Readers’ Choice Awards!
You may recall we earned awards in both categories in 2024, and we are looking to repeat these high honors. As a small (but mighty!) team, we pour our hearts into helping you buy, sell, and finance your home—offering top-notch service and interest rates that make you and your wallet smile. It’s our passion, and it means the world to be recognized for what we love to do.
Now we need a quick favor that’ll only take a couple of minutes—but gives you lifetime bragging rights for helping us achieve the highest honor: 1st place in both categories!
👉 To cast a valid vote, you’ll need to vote in at least 10 categories.
To make it easy, we’ve put together a cheat sheet with other incredible local businesses we admire and think are vote-worthy, too. But of course, feel free to choose your own favorites!
Your support truly means everything to us. Thank you for being such an important part of our journey—we couldn’t do this without you! 🏡💛
The world’s financial markets are currently in chaos as a global tariff trade war escalates. For the first time ever, the Dow Jones stock market dropped more than 1500 points two days in a row. The S&P 500 stock market is down more than 20% in recent weeks, a textbook “bear-market” collapse.
Fear, uncertainty, and panic are beginning to set in. Typically, these types of market sentiments lead to lower rates.
Dow Jones stock market free falling!
But contrary to recent sensational headlines and advertisements, mortgage rates have not had a huge slide…yet. Last week, 30-yr rates fell .15% to their lowest levels thus far in 2025. That has spurred a tremendous amount of refinance marketing activity amongst mortgage companies. But the reality is most folks with rates under 7% still won’t realize much benefit from a refi.
Mortgage Rates are improving, but not as much as the media and advertisements may suggest
If things continue, however, there will be tremendous refinance opportunities for many homeowners. As always, I will keep a watch on the financial markets and reach out when I see realistic refinance opportunities for my clients.
If you are hoping to refinance to a lower rate, temper your excitement for now. Don’t fall for the premature hype being pushed by aggressive mortgage marketing companies. But, it would be a great time to begin the application process with me as we await rates to drop further.
Let’s Get Real about Marketing in the Real Estate Business. It’s common for professionals to automate their advertising by subscribing to marketing content that is created and published by a 3rd party.
But this style of marketing gives zero insight to your brand, skills or personality, and can often backfire when many of your competitors are copying & pasting the same generic marketing materials.
I make a point of creating all of my own marketing content. Call me old-fashioned and inefficient for doing so, but it also makes me genuine and authentic.
I am very excited to pass along a big announcement from two of my biggest competitors. Why?!? Let me explain.
Earlier this week, Rocket Mortgage, one of the largest mortgage companies in the country, spent nearly $2 BILLION to acquire Redfin, one of the biggest names in real estate. You may recall that Re/Max (the largest real estate brand in the world!) did something similar back in 2016 (I wrote about it then too).
They aim to create a “one-stop-shop” experience for clients so they can buy, sell, and finance homes from a single source. Hmmmm, why didn’t I think of that? 😉
The biggest brand names in real estate are joining forces and copying my one-stop-shop business model. Some may say this trend of big companies creating end-to-end consumer “ecosystems” is bad for my business. Should I be concerned about my market share?
Perhaps, but the overwhelming feeling I have is one of flattery. I’m absolutely flattered that the likes of Rocket Mortgage and Redfin, publicly-traded companies valued at BILLIONS of dollars, are trying to emulate us!
The Blue Waters Group has believed from our very beginnings that the customer benefits from competent and compassionate advisors who can offer both mortgage and real estate services. With Rocket Mortgage & Redfin literally spending billions of bucks, no longer is our business model the obscure alternative; it is the one that leading industry players are striving for. No longer is our platform one that I need to defend with blog posts titled Is What I Do Legal?; it is the one that’s copied by others.
We are still unique from these big company aspirations in that our associates are able to offer both mortgage and real estate services (all of us are licensed both as mortgage loan originators and real estate agents) while Rocket simply hopes to pair mortgage and real estate services more efficiently by providing them under the same corporate umbrella. Nevertheless, this week’s move by Rocket Mortgage & Redfin further validates the craft I’ve been honing for nearly my entire career.
Working as both a mortgage broker and REALTOR is not an easy task, but with a 22-year head start on these firms and others who are sure to follow suit, I’m confident The Blue Waters Group will continue to be imitated but never duplicated!
Should you call a big bank to get the lowest rate? Nope!
Let’s get real about big banks. Some folks think that they need to go to a big bank like this one to get the best mortgage rate on their next home loan. When in actuality, nothing could be farther from the truth.
Chase Bank, the largest bank in America, has nearly 5,000 branches just like this one all across the country. In 2022 alone, they spent nearly $3 billion in advertising. So think about it…big banks with big expenses like this they need to earn big time interest on the loans that they issue in order to make a profit.
Last month as an example, I had a longtime acquaintance of mine reach out to me because he was in contract by a new house. He’s a big time depositor with Chase Bank so he reached out and got a home loan quote from them thinking that they would give him a smoking deal. Well, I was actually able to find a lender of mine that offered him an interest rate nearly half a percent lower than Chase’s rate saving hundreds of dollars every month on his mortgage payment.
So here’s the deal…as a mortgage broker over the last 20 years I don’t work with big retail banks that spend billions on advertising and rent. Instead I work with reputable wholesale lenders that have much lower overhead expenses and as a result they and I can offer you better rates.
Lets Get Real! Buying a Brand New Home can seem like the easy option in today’s real estate market. Picking your finishes and having tons of incentives thrown at you by a big builder sounds like quite the treat!
But that’s not what my latest client experienced. He called me last month really anxious because he had lost trust in the nationwide company building his new home. The worst of it was the in-house lender that was supposed to be giving him a great deal in fact wasn’t and clearly were inept at doing their job.
I was able to offer him an interest rate comparable to the builder’s advertised “unbeatable” offer, and more importantly ease my client’s nerves by having someone they trust involved in the process. They are set to close today and move in just in time for the holidays.
Here’s the take-away…even when buying a new home you still need your own real estate and mortgage advocates. Remember, the sales office is employed by the builder, so who do you think they’re looking out for first. I’ll give you a hint…its not you! And these in-house mortgage companies created by the builders are operating as loss leaders to get buyers in the door, which means they are probably not compensating their mortgage consultants very well, which probably means you’re not working with the sharpest knives in the mortgage drawer.
So, if you are thinking of buying a brand new home in the coming year, hit me up before even heading out to their model homes. We’ll discuss what you need to watch out for, and I’ll explain to you why having me involved in the process as either your REALTOR, mortgage broker or both is a huge benefit for you, and how you can have my representation services when buying a new home.
Over the past 15 years, I’ve provided an annual forecast of the mortgage and real estate markets. Generally, I speak to three main characteristics: housing supply, buyer demand, and interest rates.
This year, it’s all about the rates. If 30-yr mortgage rates remain at 7% or higher, housing supply and buyer demand will remain anemic. If they fall below 6%, we will see a flood of both buyers and sellers enter the market. Much of 2023 & 2024 saw rates largely stay within the 6-7% range, which led to generational-low transaction count and record-low affordability levels.
As such, it makes sense to focus my forecast on where interest rates may be heading in 2025.
Who Controls Interest Rates?
Many people are led to believe mortgage rates are controlled by select individuals, such as bank CEOs, The Federal Reserve Board (affectionately known as “The Fed”), or the sitting president (not sure what his affectionate nickname is at the moment). This is not correct!
Mortgage rates are actually controlled by the buyers and sellers of mortgage backed securities. In plainer words, mortgage rates move by investors trading mortgages. There is no man behind the curtain; no key players puppeteering rates, nor a president successfully demanding interest rates “to drop immediately“.
Instead, rates move based on risk & opportunity cost for these free-market investors. Let’s talk briefly about each of these factors.
First off, the biggest risk factor for a mortgage trader is inflation. Inflation eats away at the value of money, so when inflation increases traders don’t want to buy ultra-low rate mortgages. If they buy a mortgage bond with a 3% fixed rate, but inflation is at 4% they are actually losing money.
And opportunity cost is simply a question of can a trader buy an alternative investment with a higher rate of return & lower risk. So, no smart trader would buy a 3% mortgage when there are risk-free money market accounts offering 4% savings rates.
Below are the issues mortgage traders will be focused on in determining how much in mortgages they want to buy and at what interest rates.
Factors in 2025 that will push rates DOWN
Slowing Economy – Many sectors of our global economy have slowed down in recent quarters. Many factors could have contributed to this (political uncertainty, rising cost of goods/services, ), but generally interest rates fall during sluggish economic times. The primary driver of recent Gross Domestic Product (GDP) growth was personal consumption, but I believe personal consumption will slow in 2025 as households are forced to tighten their financial belts. Credit card balances are at record highs and continue to climb (check out my prior post about the alarming levels of household debt).
Lower Inflation – Rising prices on everything took a toll on most of the world in 2022-2023, but things are starting to ease. Inflation rates are now slightly over the historical trend and The Fed’s preferred level of inflation. Don’t expect prices of things to fall, but if they hold at near-constant levels then mortgage rates should decline.
Higher Unemployment – If fewer people are working, it is a sign of a weakening economy. While statistics continue to show 100-200K new jobs being created every month, this could change dramatically in the coming months. The largest employer in the US (the federal government itself) is mandating most employees to return to the office for work and looking to significantly scale back the total number of government employees. This could drastically change the employment picture, and push the unemployment rate up.
Factors in 2025 that will push rates UP
Long-term Tariffs – President Trump is using Executive Orders to impose or threaten tariffs on certain countries and certain products. Tariffs are essentially an added tax on goods that are made in a foreign country. Some people think this added cost will be absorbed by the foreign company who is importing the goods, but this is rarely the case with tariffs. The tariff is typically added to the cost of the item, meaning the end consumer (Americans) will incur these tariff expenses. If tariffs become more of an entrenched part of Trump’s foreign policy rather than a short-term negotiating tactic, it will drive up inflation and interest rates with it.
Smaller Labor Force – Between deportations and baby boomers retiring, the number of available workers could decrease. With fewer workers, employers will need to increase wages to entice people to the workforce. This will fuel the flames of inflation (as it did when we came out of the deepest economic trenches of the pandemic) and push interest rates up higher still.
Growing Government Debt – Our country is in debt more than ever before. Presently, we carry over $30 TRILLION in debt, which is over 120% of our Annual GDP. That percentage is similar to levels seen at the end of World War II. It made sense we were in debt up to our eyeballs after fighting a World War for 4 years, but this is the first time we’ve been at these levels during peacetime! Our government debt is sold to investors via Treasury bonds, and the more we go into debt the more we have to entice them to keep buying our bonds. This enticement is in the form of higher rates of interest earned by the investor (and paid by the borrower). If rates of gov’t bonds increase, then mortgage rates will follow suit as well.
What Will Win The Tug-of-War?
2025 will see these pressures pull against one another, and neither will be a clear-cut winner. I do believe the downward pressures will slightly win out, as some of the upward pressures (tariffs in particular) also tend to slow down an economy, which should lead to lower rates. Overall, if you start hearing the R-word (“recession”) thrown around in 2025, expect 30-year rates to finally dip below 6% by the end of this year.
If mortgage rates do considerably improve, there will be more real estate transactions but not necessarily higher home values. It is expected more homes will come up for sale (both new construction and resale homes), which will keep home values somewhat in check.
If mortgage rates end up increasing above 7%, then we could see home values fall. With affordability already out of reach for so many potential home buyers, worsening conditions will further reduce the already anemic levels of demand currently seen.
Do you have thoughts or insights to share about your local real estate market? Leave them in the comments section below.
Matt Sundermier's Memos on Real Estate & on Life 