Good morning, good afternoon, good evening. Wherever you are and whenever you're listening, I want to congratulate you on taking steps to becoming an expert in your industry. This is Mortgage mindset, a mortgage matchmaker series. My name is Hunter Boyd. I'm the director of sales for the Sherry Riano team, based out of Cary, North Carolina. And I am with. Greetings. My name is Chris Brazell, director of operations with the Sherry Riano mortgage team. Yeah, so this podcast is going to be for anyone in real estate, really. It's going to be for mortgage lenders. It's going to be for agents, attorneys, title companies, even property management. Anyone who could benefit from a little bit more knowledge going into 2024 and really becoming the expert in your field. We're going to talk about everything from economics in the market to interest rates, loan programs really anything that could help you in your business when it comes to talking with your clients. How can you repeat this information? We want to be here to help you become the expert. You be the expert. We're here to help is really our sole purpose here. So without further ado, let's go ahead and jump right into the first episode. Chris, give me some predictions for 2024. What do you think we're going to see? I think it's going to be a wild year for us. Yeah, I agree, Hunter. as we all know, 2019, 2020. It was a pretty crazy time of year, or pretty crazy time in this industry with the pandemic and everything kicking off and historically low interest rates. At that time there was only one way for interest rates to go up. So, of course, over the past two years or so, interest rates have been on a steady increase, where we've actually seen the highest interest rates historically in past 30 plus years. So, with that being said, I think that the Fed has done what they've kind of set out to do. Now, we can agree or disagree on the overall fed's agenda and their goals with the economy. that's a debate which maybe we have on another show, but for this one right now, what the fed did I think they've accomplished enough on what they were trying to do, which is stave off inflation. The past couple of months, we have seen inflation numbers come in lower on an annual basis, which is good. And so with that, they actually did not raise prime interest rate the last time they met. And now the talk around the water cooler, so to speak, is that they actually may start lowering prime interest rate next year, which is good news. For the mortgage industry. Good news for everybody. just buying a gallon of milk hopefully will start to be a little bit cheaper for everybody, but absolutely, yeah. And what that does is, I think that since we kind of hit the peak on the other end with the higher interest rates, I think we're going to start seeing them come down in 2024. what that means is that we're going to see a lot more people coming out of the woodwork, people that have been sitting on the sidelines that kind of put their house hunting on hold that felt they were being priced out of the market with raising home prices as well as high interest rates. people can't wait any longer. So I think once they start hearing on the national media that the interest rates have come down, it's all relative. At that point, all they're going to hear is lower interest rates. That means they're going to jump back into the market. So I think it's time for all of us to buckle up, which is one of the reasons that we wanted to do this podcast like Hunter was saying, to sharpen our skills, sharpen our tools, and make sure that we're all ready as the professionals in this market. Because I think it's going to be a fun year. And I say fun because I love this job, I love this business, and I think we're going to see another boom with people coming out and wanting to buy again, people refinancing with the lower interest rates. Yeah, I'm very excited for 2024. I am so tired of telling people rates are going, rates are going up. I love following up that information with the people who run the federal bank that you would think and imagine they're an economists. That's their expertise. But they're actually lawyers. And so it's always fun to see a lawyer's interpretation of the economy and really kind of reviewing just all the statistics and analytics there. so big question. where are we going with rates in 2024? I think that is on everyone's mind. I think if you've been an agent dealing with rates going up over the past 18 months and getting updates from your lender, hey, look, unfortunately, they're priced out of that house now because when they were approved at 6%, they can't afford it at seven. if you're a lender, it's been a wonder and a joy, I said it sarcastically to price seven and a half, 8%, even eight and a half percent rates. so Chris, where do you think we're going to see rates end up in 2024 and even throughout the process? Sure. I think the new norm is going to be somewhere in the low sixes. Now, I'm an internal optimist, and so I hope that we see something with a five in front of it as the new norm. It may take a little longer to get there but I definitely think in the low sixes. So we are right now we're seeing rates in the high sixes, which is great when you're talking relative speaking to where we were at eight and a quarter. Eight and a half about 9120 days ago, which was pretty scary for a little bit there, because it was wild to see it that high. It was wild. And so now that we're seeing something with a six in front of it, even though we're on the high end of sixes, it's fun to see that it's perspective. It really is. It. If you had said 36 months ago that I would have been grateful to see a 6.85, I'd have told you're crazy. That's right. but at this point, and I think that's general buyer perception as well, is we saw eight and a half percent. Six percent no longer looks as bad. And you talk to someone who bought their first house in 92, and you get on the phone with them and you're telling the rate, and you apprehensively share with them 7.75. And that old timer just says, just lock it in. I remember when it was 15%. Don't even worry about it, I'll refinance later. versus when you talk to Gen x buying their first home, 25, 26 years old, or even millennials, really. And all they really ever knew was two, three and 4%, and you share with them 7%. Man, it was like end of the world. Like, what is happening? it's very excited to see 6% again. That's right. And now that they have lived through the seven and 8%, they got those old war wounds now like the old timers did. And so when they do see those sixes, and, gosh, if we see something with a five in front of it, even better. And that's when we're going to start seeing people again, getting off the bench and getting back into the home buying market, because it is all perspective and relativeness that they're like, well, rates have gone down and they have gone down from historic highs, but they have gone down. And all they're going to hear is rates are lower. And so I think by the end of the year, we're going to see the low sixes again and cross my fingers, high fives again. So I think we've seen the worst. I think it's behind us now. And now we're just going to see a gradual decrease in rates throughout 2024. Okay. So as we're seeing the gradual increase or decrease rather, in rates when do you think it gets hot? I mean, do you see people waiting until we actually see a 6% flat rate or even a low or a high five? Nar released a report that said 7 million babies are born, 3 million marriages, and one and a half million divorces. So that's a lot of life change that happens each year. do you see those people jumping off the fence first or do you see first time home buyers? When do you think we're going to really see this move and this shift in the mindset of the US consumer? Springtime is always the busiest time. Things really ramp up in April and May and things like that. But I think we're going to start to see it come February, March. I think that's when you're going to see the people start to relook into pre qualifications and start looking at houses again. they may not be looking as serious to plan on moving in April and May, but if they see that house they like, and all of a sudden they're like, well, shoot. When I was last talking about this, it was at 8%. Now we're at six and a half percent. This house is priced good. I like the mortgage payment now that the rates are lower. Let's go, let's get off the horse and let's start buying right now. So, yeah, I think February, March, we're going to see a real big uptick in mortgage applications. I think there's also going to be a positive shock of how much more I can afford at 6% than I could at seven and a half percent. That's hundreds of dollars in difference in payment there. That's correct. I think that's going to also just increase the general excitement that I was priced out of those homes before, but they're now within my grasp and I need to move quickly. And I think it's really going to be up to one lenders, but also agents to create the sense of urgency that the consumer doesn't know that they're in. That's great, because if they wait too long, I do think they're going to have a ton more competition. I think the statistic is every 1% and decrease in interest rate. 5 million new buyers enter the market. you get in a position where you go from 8% to a 5%, and you have 15 new buyers, whether they were sitting on the fence or they can't afford it at 8%, but they can't afford a five. It's a lot more competition. really going after a limited number of homes. And while I do think we're going to see a little bit of release of availability in homes, because people aren't as willing to jump from a 3% to an 8%, will sell their homes at a 3% to a five or 3% to a six especially taking advantage of the equity they've built over the few years and maybe using some of that equity to buy back down to 4% or somewhere around there, depending on where the rate sheet is. God, I would love to see a rate sheet say 4% again. Wouldn't we all? Absolutely. And that does fall back on our whole overall kind. of motto of this talk is that it's up to us to hone our skills. So you be ahead of the ball, be ahead of the curve. Mine your database, mine your past clients, mine. If you've been in the industry two, three years, mind everybody that you talked to at one point, and they, for whatever reason, didn't buy, then get ahead of it, because the home prices are going to continue to go up, especially in our area. We've been seeing, on average, historical appreciation of 4%. It was crazy for a while there, 13, 14%, 22% in 2021, 2022 was 22%. That was wild. Couldn't hold on to a house. So we're going to see the homes prices continue to go up. you're going to see bidding wars when it does get to that busy time of year of April and May. So get those buyers prepared now by you being the professional, you talking to them about where you foresee these interest rates going, where you foresee bidding wars coming into play, when it is the busy time in spring, and tell them, hey, if you're willing right now, let's have that conversation again and get off the fence and start looking at houses again, because you want to be the first to the table, as opposed to number 50 in line with a $50,000 due diligence, $25,000 over asking price. Let's get the clients a better deal right now. That's it. And specifically for mortgage lenders listening. Chris talk to us briefly about the refinance boom that I think we're about to see in 2024. Yes. So everybody that's got a seven or eight in front of their interest rate, when they see something with a six, they are going to want to refinance. And so what you want to look at is no closing cost refinances. You want to talk to us about options on that at that time is going to be also a time where it's a long term goal for some of these clients. They're like, we don't plan on moving for the next 20 years. That's when we want to talk to them about buying points down and things like that. So you have the long term lower comfort level of the rates at that time. So we are going to see a refi boom. We're also going to see a purchase boom, I think so. It's going to be fun for everybody. It's going to be good for everybody. We're going to get people out of those higher interest rates of the sevens and eights, get them back into a low six, make that payment a lot more comfortable, make their monthly cash flow more comfortable, and do it with as little paying out of pocket as possible. And they're also going to see equity built up in their house as well. So it's going to help them win pricing on that refi. So I think come summertime, through the fall and all the way through the end of 2024, we're going to see a lot of refinances out there. And again, mortgage lenders that are listening, stay front of mind, stay top of mind with your clients. Reach out to them now proactively. Let them know that we're going to be calling you and letting you know when the opportunity arises to save $150 a month off your current monthly mortgage payment with as a little money out of pocket. Yeah. Whether you're an agent or a lender, listening right now, people will be buying, people will be refinancing in 2024, and it will be an increased number than we've seen in the last 18 months. They're going to be doing that with somebody. Are you the one they're going to think about when they go to make that decision? Are you doing your touch points? Are you bringing value to the conversation? Are you bringing value to the relationship? Are they going to think, dang, I got a guy, I got a girl that I need to call right now and get this train moving? or is it going to be a Google search that replaces you? Is it going to be a Facebook search that replaces you. You need to be developing your relationships, bringing yourself to front of mind with these people. This has been mortgage mindset, a mortgage matchmaker series. If you found this beneficial or helpful for you and your business, hit that subscribe button. Follow along with us week to week. We'd love to have you Mortgage mindset podcast is hosted by the Sherry Riano Team at Clear Mortgage powered by City First Mortgage Services, LLC Sherry Riano's NMLS id is 71774. Visit us at thesherryrianoteam.com for more information about our team. The opinions expressed on this show by the hosts and their guests are their own and do not necessarily reflect the views and opinions of clear mortgage or city first mortgage services. Please note that Clear mortgage is powered by city First Mortgages, LLC and their NMLS id is three 1117 clear mortgage and city first mortgage Services is not an agency of the federal government, is not acting on behalf of or the direction of HUD FHA. City first mortgage Services is an equal housing lender. Programs, rates and terms subject to change without notice. Underwriting terms and conditions apply.