Interest Rates and Pre-Inspection: An interesting week in the Albuquerque Real Estate Market

Tego Venturi:

I want to talk about interest rates because it was an interesting week with interest rates. You know, we saw the biggest weekly move in interest rates in the law in a long time. You know, the thing that’s funny about it. We were on with Chris Cooper from Bay equity. Who’s one of our lenders that, you know, local lender here that we work with that that’s excellent. He watches that interest rate stuff like nobody else. What were some of your takeaways when, when he talked to our team here the other day, Jane,

Jane Elizabeth:

I think the biggest takeaway is that even at 3%, which is pretty amazing, we’re still in absolutely Epic, low interest rates and the affordability.

Tego Venturi:

Well, it was funny. We were joking. They went from 275 to 3 for a lot of people. It’s like, Oh my gosh. Yeah.

Jane Elizabeth:

I think just that they went up was a little bit nerve wracking because we watched gas prices go up and now interest rates are going up and wondering if it’s an overall trend, we can’t help but ask that. But yeah, interest rates

Tego Venturi:

The one thing he said, and I think people need to think about that as if they’ve gotten a pre-approval

Speaker 2:

That’s right. Yeah. That if someone got pre-approved for a loan last week, that they need to check back in, because if they got pre-approved at the real top end of their ability to qualify, they may not qualify even with a quarter percent increase in the interest rate.

Tego Venturi:

And we’re not talking about qualifying overall, we’re talking about for a certain price point. Right. Cause now they’re what they can afford. Might have gone down a little bit, right. Again, talking a quarter point here, but it’s, it’s amazing. One of the things that I looked at this this week, Jane was predictions about interest rates, all the experts, all the housing economists, all that stuff. And

Jane Elizabeth:

What are they saying? The million dollar question

Tego Venturi:

Experts with air quotes, right? Because I think 2020 was a year of not believing the experts anymore, but sorry, I’m not going to get political here, but anyway,

Jane Elizabeth:

Everyone’s got a motive behind their opinion,

Tego Venturi:

But you know, basically what we, what we looked at, the, the group I work with that pulls this data together is we looked at what Freddie Mac said, Fannie May said, which home home, not home builders, mortgage bankers association, and the national association of realtors and, and, and all of them, if you were to just take all of them and look at them, they’re saying probably by the end of the year, we’re going to be a little bit over 3. Right. And that’s, that’s it. Now another group that I followed John Burns consulting there, they looked out to 2024 and they’re putting a 3.6 on 2024 interest rates point is nobody’s expecting a huge change in interest rates. And we there’s good chance. I saw some economists talking, there’s a good chance. We’ll never see six, 7% interest rates again, which, you know, it’s again, it’s that whole new normal thing. Right. And that could be interesting because as you know, it’s effect affected or affordability, even though home prices have gone up, correct? Jane and we only had a couple of minutes left. Cause we, we talked about,uHB one 11, which was super important. I want to just talk about pre-inspections and what’s your, your feeling. If you’re getting ready to sell your home and somebody says, Hey, should I get a pre-inspection? What do you, what do you say?

Jane Elizabeth:

I say, it’s a great idea for a lot of reasons. One of the reasons is when things are going so fast and we’re asking buyers to make quick decisions, it’s so wonderful for the buyers to have an inspection that they can look over. And it’s really like a seal of approval for the sellers too. And it says we don’t have anything to hide. This is what we’ve got. And it also helps the seller not be negotiating in a black hole. Roofs are the, probably the number one reason that deals fall out of contract. And a lot of people, they don’t even look at their roof. They might’ve moved here from another market and they don’t know that even a tile roof needs to be sealed, you know, every couple years. And so to find out after you’re already under contract two weeks, that maybe you need to put a new roof on the house. That’s a hard pill to swallow when you’re already under contract at a certain price. So don’t negotiate in a black hole when you consider the value of your home versus a 350,000, sorry, $350 inspection. It’s well worth it.

Tego Venturi:

A hundred percent, and again, I think in this market, even even more so, because you’ve got a great home, it looks good. It shows, well, it markets, well, we do great photography. We do all this stuff. We do, we get it out there and you’ve got 20 offers or 10 offers. Let’s say, let’s be a little more realistic. You wanna, you know, if you have that done, it just puts you in a much stronger position

Jane Elizabeth:

It sure does. And one of the things that, that, that is common in such a fast market, I mean, buyers are making, again such quick decisions and there’s this, you know, the next morning they wake up and say, Oh my gosh, did I do the right thing?

Tego Venturi:

Yeah. You get in that auction mindset, right. And then you have remorse.

Jane Elizabeth:

We have buyer’s regret. And so if you find out that the roof is bad, you think, Oh, it was a bad decision. It just confirms that you may be decided too quickly. And so we do everything we can to minimize that follow-up rate in how we market and how we accept offers.

Tego Venturi:

Yeah. Yeah. The other thing is the little known thing that, that we do offer is, or at least have available for sellers is warranty a warranty during the listing period. Do you want to speak to that?

Jane Elizabeth:

Yeah, absolutely. It’s something that maybe it’s a tool that we’re just starting to harness and for our sellers, but anytime, while they’re listed, which isn’t usually very long with the average house selling across the board in less than five days. And, and then that, that warranty also covers the whole pending period. So if the dishwasher goes out, thank goodness, they’ve got a, they’ve got a small co-pay and they can get a new dishwasher for at $75. I believe

Tego Venturi:

Seventy-Five dollars. It’s such again, it’s one of those peace of mind things. That’s very little investment for a whole lot of peace of mind.

Jane Elizabeth:

We need to do that for all our properties.