All Forum Posts by: Gregory Schwartz

I appreciate the well-thought-out response. And agree that any prediction is speculative because obviously know one can predict the future. Case in point... Covid. However, I use recent historical market data to help determine what is about to happen. 

What other data should I be watching? What data has shaped your perspective? 

@V.G Jason That all sounds speculative. What data supports your claim?

Existing home sales saw significant jumps in February and September/October 2024, both aligning with drops in interest rates. Are you suggesting this wasn’t a result of pent-up demand but rather due to some other factor?

I give advice around this topic to clients every day and want to know if I'm missing something. 

Maybe we're defining pent-up demand differently. I would define 'pent-up demand' as the number of people ready and willing to buy a home but holding off for very specific reasons. 

1. Potential buyers (good credit, income, and savings) holding off because of high interest rates. Aka they could get approved for the median price home today at 7% rates. 

2. Buyers that would buy if rates were 1% lower. They need the drop in rates in order to be approved for the home they want to buy. 

If these groups are significant, it suggests there’s pent-up demand that could enter the market when one of two things happen:

Rates Drop - Rates fall to levels that allow more buyers to qualify for the homes they want.

Buyer Expectations Shift - Buyers realize that 5% rates aren’t coming back soon and decide to move forward.

Based on the increase in activity I saw in Sept and Oct in my business, when rates hit low 6s, I'd say my market has plenty of pent-up demand. 

Attention investors in Bryan/College Station, TX! Let’s kick off the new year with a value-packed meetup.

📅 Date: Thursday, January 9th
🕠 Time: 5:30 PM - 7:30 PM
📍 Location: Schwartz Realty Group, 4103 S Texas Ave, Suite 105, Bryan, TX

What we’ll cover:

• Recap of the 2024 market and key takeaways
• Predictions from economists for 2025
• Discussion on strategies to grow your portfolio

This is a fantastic opportunity to connect with like-minded investors, whether you're new or experienced. Enjoy food, beverages, and great conversations. We hope to see you there!

 Each market is different but as a national average, the increasing rates have increased the inventory. Active inventory is up 40% this year. https://fred.stlouisfed.org/series/ACTLISCOUUS

Yes, there are less listings each much but the current listings are taking much longer to sell in most markets. This means that inventory keeps piling up. Basically, the demand is much weaker than the supply. 

 ouch. Mortgage News Daily is reporting rates up 0.21% to 7.13%

@Aaron Dyson those DR Horton homes are a great investment (IMO). Close to Rellis and the job growth in what the City of Bryan is calling the Texas Triangle. 

The only mistake is that you didn't work with me!!! I'm kidding. Managing these will be a breeze. Hit me up I'd love to help. Also, we need to get you to start coming to the BCS investor meet-ups! 

"I mistakenly had a rental policy instead of a builder’s risk policy."
I'll be honest this is often overlooked. And yes this is a 1 in 1000 situation but plenty of other disasters could happen and having the right insurance policy is huge to protecting down side risk. 

Thanks for sharing 

@Randall Alan Mark Zandi, one of my go-to economists, has also said that the rates should settle between 5.5-6% (https://www.cnbc.com/video/2023/11/27/mortgage-rates-will-se...). Which is why I thought rates would work their way down to the low 6s in 2025. 

But it looks like we might have to accept that rates will be much closer to 7%. 

So I guess the question is how long will it take for the general public to realize that 7% is the "new norm"? We know that there is pent-up demand and its generally accepted that that demand is being held back by "high" rates.

 I agree, but in this case, historical trends don't matter. All that matters is that buyers feel like rates are high and are reluctant to buy. Also lots of sellers have locked in <4% rates and don't want to buy at 7%