I’m going to call it right here. We have bottomed out in the real estate market and I’m talking about the major cities in California and Seattle, Washington. But there’s some of this going on all over the country. And here’s the reason why. Number one, the weather is better. I know that’s weird, but we had a long spell of ugly weather along the West Coast and people just stayed home.
Number two, more to the realities. All the big companies, the tech companies on the West Coast announced all their layoffs Microsoft, Amazon, Google, Apple, Salesforce, you name it. Continue on. And we’ve heard some of the people are in sales, especially at Google.
I use a guy for all my SEO and marketing, and what Google was trying to do is take over the business of what he did for small businesses and now they finally realize they’re just going to let the guys who are already trained( like my guy ) and know what they’re doing to do their job. And that’ll be nice because he’s good.
Anyway, now everybody knows who’s gotten laid off. This the major layoff. I’m sure there’s still be little things here and there and adjustments and because of mergers, etc., things will just continue in a normal phase of hiring and firing.
But now let’s look at what those people are going to do.
Here’s their options. If they think they’re completely unemployable for some reason and out of desperation, they would look to either sell their property or rent their property. So the question is, if they sell, how much money do they have sitting in the bank to cover the mortgage payment until they run out and then have to and then they can go into a payment program with the lender so people could kind of hang on to their house for quite a while.
It’s not an automatic thing.
Some people might decide, you know, that’s it. I just want to leave. Let me get out of here and move to wherever. Those people are probably going to put their house on the market. So it’s going to take a few months, make sure everything’s good. So we don’t really see this flood of houses after the emotional period is over.
The rational period steps in and figuring out which ones do through life and then it takes a couple of months to prepare the house, search for agents, etc., etc., and see what the market is going to be. So what’s happening now is the buyers are back in the back because the interest rates dropped almost 2%, which is everybody went and cried when it went up into the fives and housing affordability got killed.
Well, guess what? We’re down from seven to fives. Wells Fargo was quoting last week, 5%, no points on a jumbo. So that’s a beautiful thing of speaking Wells Fargo, just because I know this, the person that I send our clients to is not leaving. So there’s still going to be regular bankers there. They cut off the correspondent lending.
That was one of the big things that won’t really affect consumers. I know I’m rambling and I know I should keep this under 10 minutes. I keep going anyway, so the buyers are back. You’re seeing the lower rates. There’s two types of buyers the brand, brand, brand new buyer who is ready to jump in the pool for the first time, and the buyers who’ve been there, who looked at houses, who put offers and who lost stuff.
Those people tend to be able to win the bids now because they know they have to waive everything that they can wave. They get a fully underwritten pre-approval, so it clears out the mortgage. Closing now can be done in 15 to 17 days without any issues because the appraisers are busy. So those people are going to win because they need to be aggressive and the other way to win.
By the way, just to throw a little commercial in is use our rebate. Go to Arrivva.com and explains it all. We are a flat fee real estate mortgage broker. So if you’re a buyer, you pay $9750 and you get the rest of the buyer broker fee, which is normally about two and a half percent.
So now the competition is back, but it’s the early phase of it.
So if you get super prepared, ready to rock and roll and you’re going to jump on something, get into it, go to those houses that have been there for 45, 60 days, maybe there’s something weird about them and maybe you’re able to correct that by spending some money, obviously, or you don’t really care that it still comes around that they pretty house price straight in the right place.
It’s going to have the most people bidding on it. So you just take it from there. And by the way, I’ve been talking mostly about single families, townhouses, condos are lagging behind because that’s a different set of buyers. We did just sell a condo at the end of December, beginning of January in San Carlos. We had on the market for quite a while.
Gorgeous unit. It just took a special buyer, but the single family’s more in demand. So anyway, I think that’s about it. Just remaining in the markets. Get me crazy, get fully underwritten, pre-approved and enjoy the open houses.