Rates continue to go down, but a weird phenomenon is happening: the pending sales number is lower than expected. Meaning, fewer homes are under contract to be sold than we would have expected, considering that mortgages are more affordable as rates come down. 

Sales have increased compared to last year in the 4-county area (Milwaukee, Waukesha, Ozaukee, and Washington), however they pale in comparison to 2022. We do expect demand to rise once mortgage rates consistently "start with a 5", and feel much more palatable. Property values in Wisconsin have risen annually, and so potential homebuyers still feel the pain. Even as rates have started to come down, the greater home sale prices still drive up monthly payments. 

A few things are at play:

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1. Existing homeowners likely refinanced during the COVID-mortgage boom when rates were below 3%.They are experiencing "lock in affect" and are reluctant to give up their mortgage.

2. People are likely still waiting for rates to "fully" drop. They see the decline and are waiting for the optimal moment. "Yes, rates have come down to the mid/low-6's, but my payment will look so much better when rates hit 5.75%". 

What does this mean for you?

1. Buy while others are standing by. If you can lock down a home while competition is lighter, as rates continue to drop, and when competition rises, your home's value will too.

2. In 6-12 months you can explore a refinance and lock in a lower rate. 

Buying a house is a very individual decision for each household, but the above are at the least points to consider! 

We have had a blast recently helping clients qualify for a unique type of mortgage loan, bank statement loans.

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This may not apply to you, but perhaps to someone you know:

If a self-employed individual has a lot of write-offs and business-related expenses that reduces their taxable income, then as far as their tax returns are concerned, they don't make a lot of money.

However, for many business owners, in "real life" they do actually make quite a bit of profit. 

So, for those individuals we have an exciting option, a 12-month bank statement program. 

We can analyze 12 months of bank statements to determine which deposits are business-related revenue, and calculate qualifying mortgage income from there. We can use anywhere from 40-80% of those deposits as qualifying income on a mortgage application - how cool is that!

As an added perk, we can fully review and pre-underwrite a client so that by time they are writing an offer to purchase a property, there is no further issue down the line with the mortgage approval. We even had a client waive their financing contingency and write a "cash offer" while utilizing this program.

Questions? As always, shoot me a text at 414-488-0438.