Morning! This is MF Lending - the mortgage newsletter where we 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. Realtor’s Guide to Estimated Purchase Prices & Payments 🧭

2. Rental Market Flattens: Nashville Continues as an Outlier 🐝

3. Zillow’s Housing Market Snapshot 🤠

By the way, this article April Monthly Roll-up was the most clicked link last week, you should check it out!

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Nuwave Rates Today 📈

*Note - Look at the spreads between the 0-point option and the 1-point option. If your client is not putting down the bare minimum there are huge advantages to paying 1 point.

Realtor’s Guide to Estimated Purchase Prices & Payments 🧭

I’ve had several subscribers ask if there is an easy way to determine an estimated purchase price if you know the client’s desired monthly payment…the short answer is no.

But - here is my best attempt to assist.

This tool can give your clients solid, ballpark estimates on monthly payments - factors like property taxes, down payment amount, and mortgage insurance would change these values - but this should give them a solid estimate.

All of these estimates are with 5% down and a conservative estimate (.6%) for the property taxes. The assumed interest rate on these is 6.25%:

Another great rule of thumb (as shown above) -

“60/10 rule” - for every $10,000 increase in the purchase price, the monthly payment will increase by about $60.

If this is helpful…I can do this once or twice a month when there are major changes in the market. Let me know in the comments 😎

Rental Market Flattens: Nashville Continues as an Outlier 🐝

A recent Redfin analysis showed that rent has slowed for the 11th straight month and market predictions expect rents to fall next month for the first time since the pandemic.

Interestingly enough, we have not seen this same trend in Nashville.

The median asking rent in Nashville last month was $2,183, a 7.0% rise year-over-year the 10th highest rise in the US. (see the full list of the top 50 metros here)

For clients that are comparing that to a mortgage - with today’s rates that same payment could get you a home for around $350,000.

Rents fell primarily in the SunBelt region - led my Austin, TX and Phoenix, AZ as demand falls back down to normalized levels post-pandemic.

This is good news for inflation.

Shelter costs make up 40% of the CPI figure - a primary driver of the FED’s decision on interest rates.

If shelter costs continue to fall, it could mean inflation comes down sooner than expected, and the FED could begin cutting rates before the end of the year.

Zillow’s Housing Market Snapshot 🤠

Zillow Research released their housing market snapshot for April (if you follow the link you can find the numbers for your specific region).

Here are the key highlights for Nashville:

1. Inventory is not sitting on the market - The median “days on market” is 11 days!

   Listing agents who have quality homes and price the homes correctly, will be able to sell quickly.

2. 26% of potential sellers are worried about affording a new home -

   If current FED predictions become reality - and rates come down by the end of the summer - this could ease some of these potential sellers' concerns.

3. Inventory is slowly growing - 3.43% MOM gain in active inventory, something the market desperately needs.

4. Homes are still selling above list - for the sellers brave enough to sell, they can be rewarded. 19% of homes sold above list.

   Again - this is a testament to not only the real demand on the market for homes but also the bidding wars that can arise if homes are priced correctly.

The Cul-de-Sac

Mark your GCal & Potential Impacts 📆

1. Jun 13th - May CPI Print

2. Jun 14th - FED Meeting

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

Please forward this to your friends and colleagues if you found it valuable.

— Michael F DiLucchio