Home Value Predictions are All Over the Place... Here's What We Think.

Have you ever considered widening your search radius to find the perfect home? Join me with guest Pete Heim, in a thought-provoking discussion on the advantages of looking beyond your current geographic area, especially with the holiday-induced decline in the number of houses on the market.  However, it's not all doom and gloom; with interest rates hitting a four-month low, the potential for job growth and a bolstered economy is on the horizon.

In the spirit of keeping you informed, we take you on a journey through the world of real estate loans.  Ever thought about assuming a mortgage (only FHA) from a previous owner? We discuss why this could be a viable option for some.  We also compare the housing market data from this year with last year, emphasizing an increase in average prices and days on the market. To keep things light, we introduce a fascinating product called "Magic Mind," a drink that promises to slash stress levels and boost focus – we could all use a little of that magic, couldn't we? #magicmind

To cap things off, we delve into the future of home prices. While a report from Redfin predicts a dip in home prices in 2024, our perspective, based on a survey of 100 economists, investment strategists, and housing market analysts, is more optimistic. Although there may be a slight decrease in appreciation in 2024, home prices are projected to continue their upward trajectory through 2027.  After considering factors like unemployment rates and inflation, we conclude there's no time for despair in the real estate market. So, join us every Thursday at 7pm for your regular update on the real estate market. Isn't it time to stay ahead of the curve? #bradweisman #peteheim #realestate #thebradweismanshow

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Welcome to The Brad Weisman Show (formerly known as Real Estate and YOU), where we dive into the world of real estate, real life, and everything in between with your host, Brad Weisman! 🎙️ Join us for candid conversations, laughter, and a fresh take on the real world. Get ready to explore the ups and downs of life with a side of humor. From property to personality, we've got it all covered. Tune in, laugh along, and let's get real! 🏡🌟 #TheBradWeismanShow #RealEstateRealLife #realestateandyou

Credits - The music for my podcast was written and performed by Jeff Miller.

Transcript

Speaker 1: 0:25

From real estate to real life and everything in between the Brad Wiseman show and now your host, brad Wiseman.

Speaker 2: 0:35

All right, we are back in the studio and I am looking forward to the show. I look forward to this show every single month because we have Pete the repeat here in the studio. Do you like being called repeat?

Speaker 1: 0:48

I'm a bad penny, you are just keep showing up.

Speaker 2: 0:50

Yeah, and I think you need to shine up a little bit more, though. Maybe shine yourself up a little bit, maybe actually know you have a nice haircut. Oh, thank you. Yeah, it looks really good. Yeah, and you have no scruff. You're cleanly shave. I'm always cleanly shaving. I hung out with your son recently.

Speaker 3: 1:03

Yeah, Christopher.

Speaker 2: 1:04

He hasn't been on for a while. We got to get to. Do we chase him off, or he didn't like it? No, did I smell? Probably, probably, probably All right, so that's fine, then I smell whatever.

Speaker 1: 1:17

Let's call him when you after a shower, and then we'll get him. Yeah.

Speaker 2: 1:19

I will do that. So I'm thinking next month, next month, I'll be showered up. So what do you have? One store for me today, buddy. I looked at. I looked at the one thing which I always look at, which is how many houses are on the market, and Disappointed because it went down.

Speaker 1: 1:35

Well, it did. But you know what? We're back in the seasonality again. Yeah right, Yep, and I'm talking it up to that and so am I, because you know there's less people.

Speaker 2: 1:43

They're gonna put their house in the market this time of year just because they've got the tree set up or they have holiday stuff Going on and nobody wants to have. You know people tramp tramping through their house during those times. Now, we've always been told the house shows the best. It shows the best during the holiday season. That's people looking. That's exactly right, and, and you know it just looks nice, because usually when you have decorations out, you know your house looks better. It does. Yeah, that's why we keep our stuff up all year long, you know all your long. Yeah, the Christmas tree gets a little scary looking. Don't light up a cigar anything. Yeah, like Christmas vacation, exactly so, but no so. So I'm gonna say that too. I think we're experiencing a seasonality thing that we haven't experienced for a little bit. Yeah, if we're just back to it.

Speaker 1: 2:26

It was before COVID. Well, yeah, about two years before COVID Maybe, yeah, well we're 2023 now and yeah, but 2020 says Seasonality 17, 18, maybe somewhere in there probably because it's been a while pretty busy. Yes, yes absolutely about five years ago Probably we're coming back to it.

Speaker 2: 2:43

Yes, we are which is good. Yeah, so tell me what you got. You got a bunch of numbers written down. Yeah, I have we have, give me my glasses.

Speaker 1: 2:49

No, I mean you said 388,. You know it's 73 in the city. Yeah, 75 new constructions. That takes us what to 240? Yeah, on the resale side of Brooks County, and that's everything. Condos, townhouses, new, everything. Big homes, you know Farms, you know it's everything residential.

Speaker 2: 3:08

Well, you know what you might want to do. If you can't find something in Berks, go outside of Berks. Yeah, we've been doing that Lancaster yeah. Chester, montgomery school. Go County's got a lot of stuff going on, yep, you know, even into like the Myers town, levin County, what that way a little bit, that's right, you know. I think sometimes, when, when, when things get like this, you have to think outside the box a little bit. Which sure box in the situation is Berks County. Yeah, it's works so think outside the box of Berks County right, yeah, that's, that's a good point.

Speaker 1: 3:32

Yeah, yeah, just expand a little or maybe change your parameters up a little bit. Yep, absolutely, if you need to have a three bedroom or four bedroom, make it, put a three in, and yeah see if there's somewhere you can put one.

Speaker 2: 3:42

Yeah, basement, finish it. Yeah, exactly.

Speaker 1: 3:44

So make some be flexible. Yeah, good news all the interest rates score. It's a four month low four month low, four month load. You hear that you go. I did four months.

Speaker 3: 3:54

It's interesting to me.

Speaker 1: 3:56

Yeah, this is interesting.

Speaker 3: 3:57

Did you say interest.

Speaker 2: 3:59

Yeah, yeah, we have that, I just never figure it out. No, that's actually the worst one. That's the word, that's not the right one. So we'll figure that out at some point when I get this mixer thing down.

Speaker 1: 4:16

You know, after three or four years, my drums in next time.

Speaker 2: 4:19

So no, um, yes, so the interest rates down, yeah, I mean it was an eight and a quarter. I think it was eight.

Speaker 1: 4:25

Yeah, maybe. Yeah, it was that high, so we're down a point and a half. Well, I know the the app said seven. Yeah, you said you saw six and a half come across my desk today from a little maybe points in there. Oh no, there's no points.

Speaker 2: 4:38

Wow, it's incredible Six and a half on a 30 on a 30 year fixed. What that shows also is that means the economy slowing up, which you know we don't always want to hear that, but there's, there's a lot of things that have to weigh things out. Yeah, right, when the economy slows up, then your rates go down. Yep, that also means that hopefully the Fed rate is not going to keep going up, which means people can loan money on short term, short terms, at a less amount, right, so you know, businesses can loan money, which means that they can provide more jobs. You know there's a lot of things that go on with Interest rates, both Fed and mortgage. Absolutely, that's a lot. Yeah, it does, it really does, yeah.

Speaker 1: 5:13

And we also.

Speaker 3: 5:13

I know Hugo had a question. Yeah, go ahead, yeah, so that seemed planned. No, but I I was thinking well, do I have to do a down payment on refinancing and how do I know? When is it worth it? Like, how much does the rate has to go down in order for it?

Speaker 1: 5:37

to make sense. Yeah Well, I think, right, I think we're in agreement. It's 2%, yeah, around that. It's a good sweet spot, yeah, and not a solid. That's not a solid number there we had talked about.

Speaker 2: 5:43

There's other reasons where you could maybe go, because what do you do? What do you do? You know you just use your credit card. Of the reasons where you could maybe go one and three quarters or one and a half percent down from there, one was that if you think you have enough equity, like in your situation, you go. You got a good value on your property and if you can refinance it and get maybe a one and a half percent drop on your rate but remove PMI because the value went up and they appraise it to have more value there the 20% then you might want to do it, because now you're removing PMI and you're getting a better rate. Now what did we say? There's cost involved. There's cost involved.

Speaker 1: 6:15

Yes, and a lot of times, if you're paying on stand, you're getting a better rate there. Yeah Right, oh yeah, they can put them right in the loan too.

Speaker 3: 6:21

Oh, really, the closing cost? Yes, oh, wow, I don't know.

Speaker 1: 6:25

But again you want to make sure that 80-20 rule, so you don't have to pay PMI right. Is all those numbers work out, right yeah?

Speaker 2: 6:31

One of the things that I would do if you bought your house from a realtor which I'm going to say most people probably did I would say if you're looking at that or thinking about that, hugo, you would contact your realtor and also your mortgage person, whoever you use as a mortgage person. I would contact them and say hey look, I'm seeing the rates going down. When is it going to be the right time? And then contacting the realtor to find out what the value is of your home at that current time, because in two years from now or a year from now for you, you might be in a situation. You're at 20% or 15%. So it might make a lot of sense. It might make a lot of sense, yeah, yeah.

Speaker 1: 7:02

So you know another thing on this kind of on the same vein, I had a call from a client that I sold the house to five years ago FHA and he's asking me about the suitability of that loan. Yeah, so if you have a government loan, you have to check Now I don't think they all are, but you'd have to check to see if the new buyer can assume your mortgage payment at that lower rate. Now, the negative for the buyer is they got to come to the table with a big chunk of money because the value is up and so they're going to have to come with cash to make up the difference, right, or get a second loan. So, but it might be an option.

Speaker 2: 7:34

Well, and it might even be an option that you might be a great, an amazing buyer, buying conventional but have a lot of money to put down. That's right. So you're buying a conventional buy at FHA and put all that money down, because now you won't have the PMI either with FHA, because you're putting down that amount of money and you get this amazing rate and we're making it sound kind of easy. There's definitely a process involved and it's possible. So you want to find out. If the house was purchased FHA and they have a great rate, you might want to try to assume it, yep.

Speaker 1: 8:01

Yeah, my dad. When he got into real estate his first year in real estate in 1975, he did $4 million in volume, which was unheard of.

Speaker 2: 8:10

That's the quating.

Speaker 3: 8:11

That's a lot.

Speaker 1: 8:11

That's like $40 million today. Yeah, that's a lot. So they did a lot of assumables because the interest rates were double digits. Oh yeah absolutely 17, something like that, and actually they pushed in 1981. It was 23. Oh my gosh. I got in an 84 and they were down to like 13 and a half 14 when the pot of time I got in.

Speaker 2: 8:29

That's where adjustable rates came from, probably.

Speaker 1: 8:32

Rates were came about and, plus, people were selling homes with owner financing and Assumable yeah, they were assuming the mortgages back because the military loans back then were 4% Yep, exactly, and they were people in. You were allowed to assume them then.

Speaker 2: 8:44

I think I did one or two back in the 90s. Yeah, I did one or two.

Speaker 1: 8:49

Yeah, and it worked. It's a good option, right? Yep, they got a qualified. Yeah, that's a very good thing.

Speaker 2: 8:54

Good question there buddy, we had no idea. You're gonna ask that.

Speaker 3: 8:59

I just to point to mention maybe here the the CMG with Mike Bowers. Yeah, I got my loan with he. When I close he gave me a certificate. So when I decide to refinance there are some fees that are waived. Oh, he has like a, like a belated elf, like like certain amount of years.

Speaker 2: 9:18

That's great I know, I remember that when you mentioned to go back to the same, well, and Mike's one of our sponsors, so we know Mike Bowers, cmg home loans Are you kidding me? Does a great job. He did a great job for Hugo too. Yeah, yeah, absolutely. So what else you have I compared?

Speaker 1: 9:32

this last November Okay. To last year's November Okay. This year. The average price was 283. This includes Berks County total. This is everything 283, a little over 283. Last year this time was 276. Okay, so still, we're still up still up Yep days on market from 18 to 21, I mean yeah, and let's, we're 21. Last year, right November, we were 18. So that's a little bit, that's. That's the inventory, yeah absolutely Well.

Speaker 2: 10:01

Inventory was going up nicely for for like a good two, three months Yep, I was very excited about it.

Speaker 1: 10:06

Yep, but what's weird is absorption is a little higher, which is, yeah odd 1.2 versus one. That is odd. Doesn't make sense, right? You?

Speaker 2: 10:13

things are staying on the market a little longer, no days on market are down, so, yeah, it doesn't make sense it was a November snapshot, so yeah, kind of stresses you out sometimes, this stuff. But you know what? I have something for that. You do, I do, I do, please, bro, I have to tell you about no, seriously, I have to tell you it's probably a terrible segue.

Speaker 1: 10:29

No, that's no, that's no.

Speaker 2: 10:31

Seriously, I have to tell you about something this is really interesting. We talked about this before the show came up. Yeah, I was offered the opportunity to try this drink. Okay, it's called magic mind and not an old-fashioned. What's that? No, it's not an old-fashioned no. No, I've tried those before. Okay, yeah, I've tried those before that recently.

Speaker 1: 10:46

Yes, exactly.

Speaker 2: 10:47

Now you can pour it in there. Maybe I might be the thing to do. But no, I came across, they sent me this drink and I'm like and I'm not one I gotta tell you for somebody saying, oh, you got to try this drink. This is gonna be awesome to give you energy, things like that, and I'm one of those. It doesn't react well with caffeine and things and energy drinks like. I can't drink some of those ones you buy it, the quick Marts quick, yeah, that would stress me out. I'd be shaking all the whole thing. So I got this. I was very skeptical so I went and they gave me five bottles to try. Okay, it's called magic mind and I have to tell you I notice a difference. Really it takes about three days. So you really feel some. It's all natural. It has all kinds of cool stuff and you knew some of the stuff was in here like to Merrick, to Merrick is in there Uh. B, b3, b2, b12 all vitamins, all vitamins. There's some other herbs in there. There's that lion's mane mushroom which is like the big one today. Yep, it's not like something, that's like a little taller. Do you think it looks taller, dude, I'm gonna drink six bottles a day if it gets me taller. Seriously, so it doesn't get you taller, it's just it's just no, it's not even something like. I definitely don't get jitters from it. I've tried energy drinks. I don't even want to call it that. It's a. It's supposed to kind of open your mind. It's gonna post a clear your mind so that you have better concentration Alert all those things.

Speaker 1: 11:57

Alertness, yes, alertness Okay.

Speaker 2: 11:59

I mean, let me just it says here called smart what?

Speaker 1: 12:01

Uh yeah, magic, mind magic mind says the first it says the world's barter.

Speaker 2: 12:06

Yeah, exactly.

Speaker 1: 12:06

Yeah, I need that.

Speaker 2: 12:07

I need that too the world's first productivity drink is what it says. Oh, it says yeah each shot contains a magical combination of 13 active ingredients designed to boost energy, focus, creativity and motivation, while reducing stress and fatigue.

Speaker 1: 12:20

Oh, dude, that's who doesn't want this?

Speaker 2: 12:23

And you know, I thought my wife, I think, thought I was nuts because I'm not one to sell this kind of stuff or push this stuff right. I said, just try it. So I bought her a five-day supply of it. She said first two days, same kind of thing. You don't really feel anything. Third day you can't put your finger on it, but you just feel more alert. I feel better. I was in the treadmill, had more energy. I have to be honest, the taste is something you need to get used to okay.

Speaker 1: 12:47

Yeah, well, that's, but it's basically two shots. But that's not the purpose, it's oh, and you?

Speaker 2: 12:51

keep drinking your coffee with it. No kidding, it actually says if you, if you drink coffee, don't think that this is gonna be a problem with it. It's not. It actually enhances and it slows up, it actually spreads the caffeine Distribution, your body.

Speaker 1: 13:04

That's what caffeine does. It's a distributor. Yeah, it'll distribute this product. So it'll distribute it, yeah okay, I didn't know that.

Speaker 2: 13:10

Yeah, it is a good go. Yeah, there you go. Yeah, so, yeah. So this, this is my drink, to two cups. It's called magic mine. There's a guy from California that started. It's called his name is James Bechara. The other thing to he they worked on this for ten years and I just drank it all.

Speaker 1: 13:27

Is it magic mind calm?

Speaker 2: 13:28

It's, but here's, here's the code. You can actually use this code to get a discount. I'm in, it's a magic mind. Com back, slash Brad Wiseman. Wow, discount code is Wiseman 20. Yeah, w? E is m a n 20, and what that means, I think, is they think I'm gonna start looking like I'm 20 again. It's what that it's all about. That's the only thing I can think. I'm really into it. I just ordered more today just because and I'm paying for it I'm paying for the drink, just so you know. Now, okay, you know, if you like it, let us know. I will, you know, go on. Hugo said we're gonna have it in our Facebook post, so you will click on the link and you'll just buy it from there. Great.

Speaker 1: 13:59

All right, that's awesome. Give it a shot. And then for next, next podcast, we'll do a market update. Yeah, for for 23. Yeah, we need to do that absolutely for the year.

Speaker 2: 14:06

So let's go into some of these things. One of the things that that was interesting that we're seeing some Contradictory into information and we talk about this all the time. Oh yeah, be careful where you get your information. You know big, because there we're seeing stuff and not the bus on anybody. But redfin has a report they just put out that said that they were that they're seeing depreciation of home prices in in 2024 I Don't. And then it even noted the things of the reason why. And when you look at what they noted, yeah, it's a whole reason why it wouldn't be depreciating. Yeah, right, yeah.

Speaker 1: 14:38

I have a spin on that, go ahead.

Speaker 2: 14:39

Give me the spin.

Speaker 1: 14:40

They're big on buyers.

Speaker 2: 14:42

So I want buyers to feel better.

Speaker 1: 14:44

They want you to feel better buyers that oh. Oh gotcha fine, you're right, that's what it is, you're walking to the buyers, the audience, consider the audience.

Speaker 2: 14:53

So right, yeah, so that's they got me I. Was starting to believe this Like but no, the experts do you have? Yeah. This is interesting so, so we got this from keeping current matters. Yeah, you and I, we look at this thing all the time. Yeah you more so sometimes than I do, yeah but what's interesting is that the place for these numbers came from. I'm gonna tell you when it came from first.

Speaker 3: 15:15

So the numbers.

Speaker 2: 15:16

I'm gonna give you, we're gonna give you, is called home price Expectation survey. Yeah, pulse nomics is a great research to show the what experts forecast Basically what. Where they get the information is a hundred economists, investment strategist, housing market analyst, and then they take the results from the latest quarterly release show home prices are expected to go up every year through 2027.

Speaker 1: 15:38

Boom, there is a graph. I think I listen to them. Oh, yeah, yeah, of course I mean, I mean respectfully disagree with redfin because you have to know the audience.

Speaker 2: 15:46

But this is a hundred economists, everybody, yes, exactly.

Speaker 1: 15:50

You know, if there's one one, one or two that are wrong in there, yeah, it'll have a just out. It's pretty, pretty good average.

Speaker 2: 15:56

Yeah, exactly. So there's 100 of them. So what they're saying is 2023, 3.32, which we kind of agree, yeah a little higher than that Well. Perks County's a little better, a little higher. Now the same 2024, 2.17. So the one part they agree with with redfin is that it is going to drop. The appreciation amount is going to be slow, slower. So that's the one thing they agree there. And then 3.24, 2025, 3.79 and 4.18 for 2027, 4% of 20 back back to normal, back to that 4%. Good, but either way, I'm not sure this is all investing. This is all good, it's all good. It all looks good.

Speaker 1: 16:32

Yeah right, that's good for. That's not bad for a buyer either, because he's in the house today. This is what it's going to do.

Speaker 2: 16:37

Exactly, you're fine, absolutely. So don't don't be scared, get out there, and I think rates are going to start to really hover around that if we could get into sixes for a good amount of time, that would be great.

Speaker 1: 16:48

I think that's going to be great for everybody. It will. But you know, the other affordability thing is that when they never talk about the the job thing and the percentage of people's income, which is another factor, yeah, absolutely, I got that. Unemployment, oh, okay Thing. And in 2008, the unemployment rate was 8.3%, okay, okay. The 75 year average for unemployment has been 5.7. Wow, do you know what it is today?

Speaker 2: 17:12

3.2 3.9 3.9.

Speaker 1: 17:14

I was a little off. It's going to hover and I saw that. I saw that graph. I didn't bring it with me. I apologize, but pretty much it's going to be 4% for the next three or four years. It falls right along with what that's saying about price appreciation. Yeah, absolutely. So that's a very low unemployment rate, very low. Okay, so that's, the economy isn't going to trash. No, the real estate market.

Speaker 2: 17:35

Nope, it's not going to happen. No, the only thing that trashed, that trashed everything, was inflation. It's inflation. That's because we print too much money.

Speaker 1: 17:41

It's it Bingo. You print money, you get inflation, yeah, but that's why they raised the rates, to drop the inflation rate Exactly. It actually worked. It did work, but they're, they're, they're, they're. If they want to be selfish about it, they're going to try to get at the top.

Speaker 2: 17:52

I don't, I don't think it's going to happen. Yeah, I don't think it's a good idea.

Speaker 1: 17:55

Our economist for NAR says bad idea, bad idea, okay, let it go Absolutely.

Speaker 2: 18:00

Now let it settle down. Yeah, because it's going to take time. It takes time for stuff to settle in, absolutely.

Speaker 1: 18:04

But there's no doom and gloom?

Speaker 2: 18:05

No, everything's fine? No, absolutely not. There's no doom and gloom at all. No, so what? So are we good? I think we're good, I'm good, anything you want to ask the eight ball.

Speaker 1: 18:13

Oh, what are? What are? What are the in there?

Speaker 2: 18:15

We go what are.

Speaker 1: 18:17

They're going to be more houses on the market in the spring. Let's say that Okay.

Speaker 2: 18:20

Okay, here we go. You ready, ready, absolutely. Okay, there you go. There we go, you're ready from the best. See, that's where we get stuff from. You can get all the hundred economists, you can get all that crap, but you know what, when it comes to us, we get the information from the right place, the red, exactly the red apples. What does? The black one is good to my son took it back. He did, of course he did. He took it back. Probably more accurate, it probably is, probably is. There we go. We got all the numbers. If you want to know what's going on in this market, every single month you come in here when Pete's here and you will know exactly what's going on. Sometimes we don't, but most of the times we do. Oh yeah, that's it. That was great man, good time, good deal with you. Man. All right, take care, every Thursday at 7pm We'll see you here.