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Markets already adjusting to Fed rate reductions · Connor with Honor: AI, Real Estate and Real Life

• 0:01
  SPEAKER_00: Welcome to the Santa Clarita Real Estate Update.
• 0:04
  SPEAKER_00: You can find all the information at Santa Clarita Openhouses.com.
• 0:08
  SPEAKER_00: Today is day 263 of 2024.
• 0:11
  SPEAKER_00: And I do have some big news that everybody's been talking about.
• 0:14
  SPEAKER_00: The Federal Reserve finally has cut interest rates.
• 0:17
  SPEAKER_00: Now, before you go popping some champagne, let's break down what this really means for us here in Santa Clarita.
• 0:22
  SPEAKER_00: And of course, got a couple of stories to keep you entertained.
• 0:25
  SPEAKER_00: So the Fed's decision, and what does that mean?
• 0:27
  SPEAKER_00: The Federal Reserve decided to cut rates by half a basis point, bringing the federal funds rate down to 4.75 to 5.0%.
• 0:36
  SPEAKER_00: In simpler terms, they're trying to make borrowing a little cheaper for everyone, especially you and those looking to buy a home, and also for the banks.
• 0:45
  SPEAKER_00: Mortgage rates have already dropped in response within the 30-year fixed rate, now about 6.15%, the lowest rate since it's been last September.
• 0:55
  SPEAKER_00: So over a year ago.
• 0:56
  SPEAKER_00: Now I've had clients tell me that they're ready to jump in on the first home they see, thinking this rate drop means, oh my gosh, they're going to get a screaming deal.
• 1:04
  SPEAKER_00: One guy even texted me, Connor, I'm ready to lock in a 2% rate like it's 2021.
• 1:10
  SPEAKER_00: I had to break it to him gently that we're not quite back to the golden days of low rates just yet.
• 1:16
  SPEAKER_00: Nationally, new home sales are up by 14.6%.
• 1:20
  SPEAKER_00: That's the fastest growth since early 2022.
• 1:24
  SPEAKER_00: But just like my old gym membership, you sign up thinking you'll be ripped in a month, then reality hits.
• 1:30
  SPEAKER_00: The recovery might be happening, but it's slow.
• 1:34
  SPEAKER_00: Inventory is up 36% from last year, and we do have a long road before we actually stabilize.
• 1:42
  SPEAKER_00: In Santa Clarita, buyers are cautiously dipping their toes into the market.
• 1:47
  SPEAKER_00: One buyer I had recently that I had worked with reminded me of the first time trying hot yoga.
• 1:53
  SPEAKER_00: He was sweaty, unsure, and constantly wondering, am I doing this right?
• 1:58
  SPEAKER_00: The truth is, even with mortgage applications surging by 14%, buyers are still hesitant.
• 2:04
  SPEAKER_00: Home prices do remain high.
• 2:06
  SPEAKER_00: While we see that rate price increase slow down, affordability hasn't magically fixed itself yet.
• 2:14
  SPEAKER_00: The local impact here in Santa Clarita, median home price is still over$800,000.
• 2:19
  SPEAKER_00: While declining interest rates might help some buyers qualify for a mortgage, it's let's not kid ourselves.
• 2:26
  SPEAKER_00: It's not like houses are suddenly going to be on sale at your local Costco next to the bulk peanut butter.
• 2:32
  SPEAKER_00: The competition remains stiff and demand still outweighs supply.
• 2:37
  SPEAKER_00: If you're selling, this is definitely a pivotal moment.
• 2:39
  SPEAKER_00: A client of mine recently asked, should I list my home now or wait until things cool off?
• 2:44
  SPEAKER_00: It reminded me of when I was in high school and waited until the last minute to ask my crush to prom.
• 2:50
  SPEAKER_00: Spoiler alert, someone else asked first.
• 2:53
  SPEAKER_00: Don't wait too long or you might miss the opportunity with more buyers entering the market.
• 2:58
  SPEAKER_00: Now is a great time to list, but make sure you price it right and use a solid marketing strategy.
• 3:04
  SPEAKER_00: Get your home listed on Santa ClitoOpenhouses.com because you don't want to be the one house sitting there while everyone else is getting offers.
• 3:11
  SPEAKER_00: What's next for rates?
• 3:13
  SPEAKER_00: The Fed cut rate.
• 3:14
  SPEAKER_00: The Fed rate cut is a strong signal of economic recalibration.
• 3:19
  SPEAKER_00: But let's not forget that housing costs are still rising.
• 3:23
  SPEAKER_00: Shelter costs, which includes rent and home prices, rose by 5.2% over last year.
• 3:30
  SPEAKER_00: Even though inflation is cooling in other sectors, it's like trying to diet while still sneaking in a slice of cake every night.
• 3:37
  SPEAKER_00: Sure, overall you're doing better, but there's still a big obstacle to tackle.
• 3:42
  SPEAKER_00: The good news, well, we're likely to see more rate cuts down the road.
• 3:46
  SPEAKER_00: So if you bought at a higher rate, refining refinancing might be in your future.
• 3:51
  SPEAKER_00: And if you're still on the fence now, that's the time to stay sharp.
• 3:56
  SPEAKER_00: With regard to refinance, let me explain to you a couple things.
• 4:00
  SPEAKER_00: I put this together on a blog post a few days ago because I had clients that were starting to get phone calls from lenders who were saying, oh my gosh, you gotta hurry, now's the time to refi.
• 4:10
  SPEAKER_00: These phone calls were taking place prior to the Fed meeting.
• 4:13
  SPEAKER_00: But that shows you the dynamicness of rates, how they often start to reduce corresponding to some future change that might be happening.
• 4:23
  SPEAKER_00: The interest rate with the feds, when they hit that rate reduction, that's actually the rates banks trade money back and forth to other banks for.
• 4:33
  SPEAKER_00: But because that reduced, then the banks usually shine upon the people and say, well, we're paying less, so we can now charge the people less for mortgages.
• 4:42
  SPEAKER_00: That's where we are currently, and it's something to keep an eyeball on because we will watch how now that they've had the meeting and now they reduce the bank rate or the Fed funds rate, we're gonna see that trickle down to us even lower.
• 4:58
  SPEAKER_00: What does that mean for rates?
• 5:00
  SPEAKER_00: If they're right now six to six and a quarter, maybe by the fives, we'll have to keep our eyes on that.
• 5:05
  SPEAKER_00: But it could be something that does change in that regard.
• 5:08
  SPEAKER_00: Now I'm gonna break down Santa Cruita Valley in this portion of the show and talk about what's happening with regard to the local inventory.
• 5:15
  SPEAKER_00: So currently we have eight coming soon listings.
• 5:18
  SPEAKER_00: These are eight listings that are going to be hitting the market in the next zero to 21 days.
• 5:23
  SPEAKER_00: 89 new listings have hit the market in the last seven days.
• 5:26
  SPEAKER_00: And just like your new flavor of ice cream at your local shop, they will be gone in short order, just for the simple fact that we do have properties still moving at a pretty quick pace out here.
• 5:37
  SPEAKER_00: In fact, our absorption rate is still only about a month out, meaning if we had nothing else listed for sale, it'd take about a month to get rid of all this standing inventory currently have.
• 5:48
  SPEAKER_00: We have 71 properties that have had their prices changed in the past seven days.
• 5:52
  SPEAKER_00: 21 properties have gone back on the market and being for sale.
• 5:56
  SPEAKER_00: That number's been trickling down lately.
• 5:58
  SPEAKER_00: It seems like a lot of buyers are very set and very happy with what they're purchasing and not canceling as much as they have been in the past several months.
• 6:06
  SPEAKER_00: Back on market properties was 21, active under properties 37, 46 properties have gone pending, 48 properties closed this last week.
• 6:15
  SPEAKER_00: That number is down over the last seven-day trend.
• 6:17
  SPEAKER_00: I'll keep an eye on it.
• 6:19
  SPEAKER_00: But again, we do have school that went back into session and some other factors.
• 6:23
  SPEAKER_00: Plus, we're coming up in the holidays.
• 6:25
  SPEAKER_00: Six properties expired, 16 homes canceled, 10 have been put on hold, nine or six have been withdrawn from the market.
• 6:32
  SPEAKER_00: If you're a buyer, now might be the time to be alert.
• 6:36
  SPEAKER_00: Yes, rates are coming down, but it's not Black Friday, and it's not a Black Friday sale.
• 6:40
  SPEAKER_00: You still have to be smart about when to pull or, as I like to say, press the trigger.
• 6:46
  SPEAKER_00: Team up with me when you're ready, and I'll definitely show you how to navigate these waters.
• 6:51
  SPEAKER_00: I won't let you wander into a financial slop slop swamp.
• 6:56
  SPEAKER_00: That's where I'd come in.
• 6:57
  SPEAKER_00: For sellers, this is your moment to shine if you've been thinking about selling.
• 7:00
  SPEAKER_00: The decline in rates is bringing buyers out of the woodwork, but with inventory on the rise, the competition is heating up faster than my kitchen when I try to bake.
• 7:10
  SPEAKER_00: Make sure your home is priced right and marketed aggressively to attract the best buyers.
• 7:15
  SPEAKER_00: In today's update in Santa Clarita Real Estate, if you're thinking about buying or selling or just want to stay on top of the trends, be sure to visit SantaClarita Openhouses.com for all the current listings and sold data.
• 7:27
  SPEAKER_00: I'm Connor with honor, and as always, I'm here to make help you make the best decisions for your real estate needs, which in integrity, transparency, and results.
• 7:38
  SPEAKER_00: Stay tuned for more updates as we watch how the Fed continues to maybe make rates or the Fed funds rate adjustment is going to continue to trickle in to the real estate market, maybe causing it to continue to advance and maybe even speed up here in the next couple weeks.
• 7:58
  SPEAKER_00: I hope you're well.
• 7:58
  SPEAKER_00: I'm Connor with Honor.
• 8:00
  SPEAKER_00: Over and out.