- The Ragetté Report
- Posts
- Mortgage Rates Rise Despite Fed Cuts
Mortgage Rates Rise Despite Fed Cuts
Plus, The $79,000 Question for Sellers, How Much Over Ask?, Toll Brothers Invests $4.38M in Yonkers, Mortgage Watch, and This Week's Westchester Events
Ralph Ragetté Jr
October 11, 2024 • Reading Time: 9 minutes
My heartfelt sympathies go out to everyone affected by Hurricanes Helene and Milton. It's truly heartbreaking to witness the devastation caused by these storms.
My family and I are hoping for a swift recovery for all those impacted. If there's anything we can do to support you, please don't hesitate to reach out.
CNBC just released a guide on filing insurance claims after natural disasters — please share it with anyone who might need it.
Mortgage Rates Rise Despite Fed Cuts
While the Federal Reserve's decisions influence the economy, their impact on long-term rates like mortgages is indirect. Following the Fed's 0.50% rate cut on September 18th, mortgage rates began to increase slightly. This week, the 30-year fixed-rate mortgage rate jumped to 6.64%, the largest one-week increase since April. Here’s why:
Economic Data: Better than expected housing starts, retail sales, labor figures, and the September jobs report exceeded expectations.
Rise in Treasury Yields: Mortgage rates are closely tied to long-term U.S. Treasury yields. As they have risen, so have mortgage rates.
Investor Concerns: Concerns about inflation and monetary policy shifts are fueling rate volatility.
Mortgage rates are volatile. The 30-year average hit a two-year low of 6.11% last month before the Fed cuts, compared to 7.57% a year ago, and today’s rate of 6.64%.
Ralph’s Take
Some buyers are holding back, likely waiting for rates to fall further. Interestingly, housing sentiment has reached a two-year high, with many expecting rates to decrease over the next year. My advice to buyers? Be cautious about trying to "time" the market; instead, focus on your personal financial readiness rather than market conditions alone. Looking ahead, the 30-year fixed mortgage rate is expected to remain near 6%.
    |
The $79,000 Question for Sellers
For homeowners considering selling their property "For Sale By Owner" (FSBO), it may seem like a good way to save on real estate commissions, but it might not be the best financial choice. Recent data shows that sellers who work with a real estate agent earn an average of $79,000 more than those who sell on their own. Agents assist with pricing, marketing, and negotiations, resulting in higher profits. Here are some additional insights:
Marketing Challenges: While 68% of buyers find homes through real estate agents, only 48% of FSBO sellers actively market their properties.
Days on Market: 48% of sellers think their home would have sold faster had they used an agent.
Lower Sale Price: Nationally, the average FSBO home sells for about $310,000, compared to $405,000 for agent-assisted sales - a 30% difference.
Success Rate: Only 11% of sellers manage to sell their homes successfully without an agent.
Results: 80% of sellers who sold without agent representation regret their decision. 24% wishing they had received more offers.
Ralph’s Take
The potential loss in sale price and the challenges of creating marketing exposure, pricing the home correctly, and managing the transaction often outweigh the savings for FSBO sellers. In fact, 73% of sellers attribute accurate pricing to their agents, significantly boosting their final profit. Additionally, 82% say a good agent is worth the commission, as they make the process smoother and less stressful.
Thinking about selling your home? Find out how much more you could make with expert help. Reply to this email to learn how we can assist in maximizing your profit.
| |
How Much Over Ask? 🤯
14 S Dutcher Street in Irvington
Last week, 14 South Dutcher Street in Irvington closed for a staggering 159% of its asking price. Initially listed in June for $850,000, the property sparked a bidding war that drove the final sale price to an impressive $1,351,888 — the highest sold percentage over asking in Westchester County this year.
It begs the question: do we think the winning buyers invoked an escalation clause? I hope so — they might have saved some money!
| |
Toll Brothers Invests $4.38M in Yonkers
Toll Brothers has purchased a 5.04-acre parcel in Yonkers, New York, for $4.38 million, aiming to develop a 28-unit residential cluster on the site. The Yonkers Planning Board approved the project, which will feature homes ranging from 2,000 to 3,000 square feet, built in pairs. The project will include a 1.07-acre open space with stormwater management, using a Planned Cluster Development (PCD) approach to preserve green space.
| |
Mortgage Watch 📉
Since reaching a high of 7.52% in April, the average 30-year fixed mortgage rate continues to drop. Today’s rate is up slightly from last week, 6.64%.
> The rate you may be eligible for can vary greatly from the daily average published via Mortgage News Daily. I use this figure as a proxy for how the mortgage market is shifting.
Saturday, October 12th - Sunday October 13th:
10/11 - 10/14: Columbus Day Carnival & Parade
10/12 - 10/14: It’s Great to Live in Harrison Festival
10/12 - 10/13: Harvest Moon Fall Fest
10/12 - 10/13: Outhouse Orchards Fall Festival
10/12 - 10/13: Salinger’s Fall Festival
10/12 - 10/13: Pumpkin Picking Weekend
10/13: Bicycle Sunday (last one!)
10/13: Hastings Flea Spooky Market
10/13: Paddleboarding Witches Festival
10/13: White Plains Oktoberfest
10/13: Yorktown Fall Festival & Car Show
Ongoing thru 11/17: The Blaze
Ongoing thru 11/2: Scared by the Sound
Ongoing thru 11/17: The Blaze
On Monday, I became a Godfather as my sister welcomed her first child, Julian Anthony. He arrived a little early, and he’s tired, but he’s healthy and all are happy!
This market is not perfect. I'm here to help.
Schedule a consultation to develop your end-of-year or 2025 game plan.
Email, call or text message me at (914) 202-1101.
Wishing an easy fast and meaningful period of reflection to all those observing Yom Kippur. Thanks for reading and enjoy the weekend!
-Ralph 🫡