Maximizing Returns in a Changing Real Estate Environment | Weekly Business Briefs w/ Martin Perdomo

The episode elaborates on significant changes in the real estate market, highlighting the rising interest in home tours amidst falling sales and examining the ongoing impact of high interest rates. Listeners will gain valuable insights into potential opportunities for investors and the importance of careful market analysis. 
• Trends revealing increased home tour interest and declining sales 
• Impact of high mortgage rates on buyer behavior 
• Federal Reserve’s role in maintaining high interest rates 
• Opportunities in the rental market due to shifts in buyer focus 
• Vacancy rates in different regions indicating market health 
• Tips for navigating current real estate challenges 
Join us at our Wealthy AF meetup on January 17th in Lehigh Valley, PA. Reserve your spot at WealthyAFai!

Transcript

Speaker 1: 0:00

In today's episode we'll dive into two major trends shaping the real estate landscape right now. Plus, I've got a special announcement for our upcoming event at the Wealthy AF meetup happening on January 17th at the Lehigh Valley. You're not going to want to miss this. Let's jump into the first big piece of news. Home tours are on a rise, but sales are falling. According to the latest market update from Redfin, buyer interest is growing as home tours have increased in many major markets. Sounds like good news, right? Well, not exactly. Even though more people out there are looking for homes, actual home sales are down. The biggest reason high mortgage rates and limited inventory. Buyers are still interested in seeing homes, but when it comes to pulling the trigger, they're holding back. The reason is simple High mortgage rates are still weighing down affordability. The average 30-year mortgage rate remains stubbornly high, sitting at around 7.8%, which has sidelined many potential buyers who are concerned about looking in a deal at these rates. Here's a key stat While home tours rose 13%, pending sales dropped by 5% year over year, according to Redfin, and that gap tells us that buyers are browsing, but they're not ready to pull the trigger yet. So what does this mean for real estate investors? If you're looking to buy, there are many opportunities to negotiate better deals as sellers become more motivated. If you're a seller, pricing competitively and being patient may be the key to closing the deal. Before we move on to the second big headline, let me mention to you about the Wealthy AF meetup coming up on January 17th in the Lehigh Valley, pennsylvania market. This is your chance to meet with other real estate professionals, learn new strategies and get ahead of 2025's market trends. And here's the best part it's completely free, guys, but spots are limited, so make sure to secure your spot at WealthyAFai. I'll see you there.

Speaker 1: 2:27

Now let's talk about the latest news from the Federal Reserve and why it matters for real estate investors. According to the Fed's last meeting minutes, we may not see rate cuts as soon as we hoped. With inflation still above the target, some Fed officials have signaled that they are reluctant to lower interest rates, even with the economic slowdown. In fact, the minutes showed that further rate cuts face high hurdles. What does this mean to us? To you and I? Interest rates are likely to stay higher for longer, which could continue to put pressure on borrowing costs, whether you're looking for a mortgage, refinancing or taking out a loan for an investment property. This is important to watch Because the Fed raises or holds rates steady. It directly impacts you and I's affordability and in the housing market, high rates mean higher monthly payments for homebuyers and this, in turn, dampens the overall demand.

Speaker 1: 3:33

This is simple economics guys. This is simple economics guys For real estate investors. This may push more buyers into the rental market, which can be an opportunity to strengthen your rental portfolio while buying conditions remain tough. I will warn you about this, though. I totally agree that this is an opportunity for a rental to buy and hold during this time, for rental to buy and hold during this time. The challenge is that also, we are seeing vacancy increase right, so be very careful.

Speaker 1: 4:05

Make sure you study your market, because we're seeing vacancy, especially in the Sunbelt, creep upwards. In the Northeast, we're seeing vacancies hold steady and we're seeing demand for rentals a little bit higher, according to CBRE. But I will tell you, in northeast Pennsylvania, that has not been my experience. I am seeing vacancies for longer. I'm personally experiencing a little bit of higher vacancies right now in this winter of 2025, but the overall I'm just one guy the overall market says that the Northeast is actually the vacancy rates are actually better with a four, three and a half 3.8% vacancy rate, while in the Sunbelt States because of oversupply, where they're seeing a 93% occupancy, which means it's a 7% vacancy, which is pretty high.

Speaker 1: 4:58

Well, that's it for this episode of Wealthy AF, and remember to register for our Wealthy AF meetup in the Lehigh Valley on January 17th. This is a perfect chance for you to learn strategies to thrive in this high interest rate environment. Reserve your spot at WealthyAFai Now, see you soon, appreciate you and if you're ready to turn your goals into gold, you're in the right place, because being broke was never the plan. Let's be wealthy AF. Peace out. And that's a wrap for the Real Estate Market Update.