Morning! This is MF Lending. We’re the fool-proof way to serve up mortgage and real estate market knowledge without any of the guesswork. So you’ll look like the smartest agent in the room.

Here’s what we’ve got for you today:

1. Home Prices Continue to Rise: CoreLogic Report 📱

2. Most Popular Metros for Gen Z Buyers 🏙️

3. Apple Vision Pro: Real Estate Use Cases 🥽

By the way, this article: May Monthly-Roll Up was the most clicked link in this newsletter last week, check it out if you are interested.

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Nuwave Rates Today 📉

Home Prices Continue to Rise: CoreLogic Report

Home prices are up 1.2% month-over-month from April - according to the most recent CoreLogic Report and year-over-year up 2.0%.

Expectations are that home prices will grow 4.6% over the next 12 months.

At this point, 60% of all previous price declines have already recovered and are on track to fully recover by August.

Why are prices expected to rise?

Inventory is decelerating in 95% of markets across the country.

With less and less inventory in the market and the steady increase in interest rates, potential buyers are choosing to remove themselves from the market entirely.

What does this mean for a client’s payment?

If a client is looking at a home for around $500,000 this year, next year that same home would be worth about $525,000.

If rates stay consistent (at or around 6.5%) that client’s payment would be about $148 more expensive monthly than it is today. Even if interest drops to 5.99% it would be the same payment that they would have today.

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The bigger concern that I see for clients exiting the market today is the reality for homebuyers when rates do begin to fall.

As soon as we see rates come down below 6% (which we could see as early as Jan or Feb 2024) - we are going to see a flood of buyers into the market. There is going to be a feeding frenzy on the homes available in the market and it will result in offers well over list.

As I told clients in a consultation yesterday, at some point they need to decide which bullet to bite - get in now at a higher payment than they want, or wait and bring much more cash to the table.

Public Service Announcement: Prices are not coming down - they are rising. They will continue to rise all year - and when the FED cuts rates, they will rise even further.

Apple Vision Pro: Real Estate Use Cases

Admittedly, I tend to get overly excited about new tech. I remember thinking Google Glass was rolling out back when the original commercial came out in 2013…

But - this Vision Pro release is something that is truly incredible. If you have ten mins today…I would highly recommend watching this.

The real estate use cases for a technology like this are also countless. Even if your clients won’t shell out $3,500 for this…your brokerage could. As this technology develops we could see things like:

• Virtual tours - especially for out-of-state or relocation clients who want to get a true feel for the home.

• Virtual staging - have a new listing but don’t want to stage it? Create the environment you want for the home and let potential buyers tour the home you designed. Give the house the ambiance you want, throw in an accent wall, change the wall colors, etc., without the contract work.

• New Build Design - For clients building or purchasing new builds - let them walk through the rendered design, move things around, and truly make it custom to their liking

• Renovation Projects - Take a contractor through your home, remove walls, redesign kitchens, add a DADU, etc all with full picture of the space.

• Landscape Design - Design the perfect patio, deck, or landscaping for a client. Move trees around, change the stone selections, etc.

These are just the first use cases I could think of. This could be a truly powerful tool for agents and listing clients if used to its full potential. I am excited to see what is possible.

Are there any other use cases you can think of? Let me know in the comments!

Most Popular Metros for Gen Z Buyers

Currently, Gen Z makes up only 15% of the potential buyers in the market. But, that is expected to grow tremendously as we move through the 2020s.

LendingTree did a study on mortgage applications from Gen Z clients throughout 2022 to determine the most popular metros for this group.

Nashville landed a #9.

You can see the full list of metros here - *note be careful clicking any links on LendingTree site, if you click something wrong you will get about 300 calls from lenders 🤣

GenZ homebuyers are obviously priced out of the largest coastal cities (as are the rest of us) with NYC and CA cities landing in the bottom ten metros.

As this sect of homebuyers continues to grow, expect demand to also grow in these metros.

The Cul-de-Sac

Thanks for reading - that is all we have for today 😎

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— Michael F DiLucchio