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  • NEIL: ALL RIGHT, WE TALKED ABOUT

  • THE INTEREST RATES BACKING UP A

  • LITTLE BIT AND THEY'RE STILL

  • HISTORICALLY VERY VERY LOW BUT

  • FOR THOSE INTERESTED IN

  • REFINANCING A LOT APPARENTLY

  • FEEL THEIR WINDOW HAS COME AND

  • GONE AND UP AND SHUT AND CAMPUS

  • COMPANY FOUNDER AND REALTOR

  • JOINS US.

  • THERE'S BEEN A FREEZE IN THIS

  • ACTIVITY OR WHAT APPEARS TO BE

  • ONE KATRINA AND I'M NOT SURE IF

  • IT'S JUSTIFIED BUT IT IS WHAT IT

  • IS.

  • WE'VE HAD THESE STARTS BEFORE

  • BUT THIS SEEMS TO BE PURELY RATE

  • DRIVEN AND WE'VE HIT A POINT AT

  • WHICH A LOT OF POTENTIAL

  • BORROWERS SAID THAT'S IT.

  • WHAT DO YOU THINK?

  • >> WELL I THINK THE REFINANCE

  • MARKET IS DEFINITELY EXTREMELY

  • ALIGNED WITH THESE RATE CHANGES,

  • SO WHAT YOU'RE SEEING IS YOU'RE

  • SEEING A LARGE DECREASE IN

  • HOMEOWNERS WANTING TO REFINANCE

  • BECAUSE RATES CONTINUE TO GO UP.

  • WHY?

  • WELL BECAUSE MANY OF THEM

  • ALREADY HAVE LOWER RATES AND ARE

  • BEING OFFERED IN THE CURRENT

  • MARKET SO IT JUST DOESN'T MAKE

  • SENSE TO REFINANCE.

  • IRONICALLY, WE HAVEN'T REALLY

  • SEEN THE HOUSING MARKET SUFFER

  • TOO MUCH AS A RESULT OF THE RATE

  • INCREASES AND I BELIEVE THAT THE

  • REASON FOR THAT IS BECAUSE BUYER

  • S ARE TRYING TO TAKE

  • ADVANTAGE OF IT BECAUSE THEY

  • KNOW AND THEY SENSE THAT RATES

  • ARE GOING TO CONTINUE TO GO UP

  • SO HISTORICALLY AS YOU MENTIONED

  • NEIL WE'RE STILL RELATIVELY LOW

  • BY THOSE STANDARDS HISTORICAL

  • STANDARDS AND WE HAVE BEEN SPOIL

  • ED FOR SOME TIME NOW WITH

  • EXTREMELY LOW INTEREST

  • RATES BUT THERE'S STILL TIME TO

  • TAKE ADVANTAGE OF THESE RATES

  • THAT ARE CURRENTLY AROUND 4.45%,

  • 4.5%.

  • I'VE ALSO SEEN A LOT OF SELLERS

  • THAT HAVE ASKED ME TO DECREASE

  • THE ASKING PRICE OF THEIR HOME

  • IN HOPES THAT THEY CAN GET THEIR

  • HOUSE SOLD BEFORE RATES CONTINUE

  • TO GO UP.

  • THESE SELLERS ARE ALSO GOING TO

  • HAVE TO PURCHASE NEW HOMES SO

  • I'M GETTING THOSE PHONE CALLS A

  • LOT WHERE A SELLER WOULD SAY

  • KATRINA I WANT TO REDUCE MY

  • PRICE I DON'T EVEN ASK THEM TO

  • DO IT.

  • THEY'RE CALLING ME TELLING ME TO

  • REDUCE THE PRICE BECAUSE WE WANT

  • TO SELL AND LOCK IN A RATE AN

  • INTEREST RATE CHANGE HERE WITH

  • THEIR PURCHASE, SO I'M REALLY

  • SEEING A LOT OF INCENTIVE TO BE

  • ABLE TO PURCHASE.

  • NOW I THINK LONG TERM THE

  • HOUSING MARKET WILL PROBABLY

  • SLOW DOWN AS A RESULT OF THESE

  • RATE CHANGES AS WAGES ARE JUST

  • NOT INCREASING AT THE SAME RATE

  • AS HOME PRICES, AND WITH THESE

  • INCREASES WE'RE ALSO SEEING THAT

  • THE BUYING POWER WILL PROBABLY

  • DECREASE MOVING FORWARD.

  • NEIL: YOU'VE ALWAYS REMINDED ME

  • THAT JOB BEATS RATES I THINK THE

  • JUST OF THAT ARGUMENT WAS IF YOU

  • GOT A GOOD ECONOMY AND JOBS ARE

  • PLENTIFUL AND SECURE AN UP-TICK

  • IN RATES IS AN AFTERTHOUGHT AS

  • LONG AS IT DOESN'T GET CRAZY I

  • GUESS WHAT DO YOU SEE HAPPENING?

  • >> WELL WE HAVE EXTREMELY LOW

  • UNEMPLOYMENT HISTORICALLY

  • SPEAKING SO THE ECONOMY IS DOING

  • EXTREMELY WELL WHICH IS THE

  • REASON I THINK IT'S IMPORTANT TO

  • NOTE THAT THE REASON THAT THE

  • FED IS ACTUALLY INCREASING RATES

  • IS BECAUSE THE ECONOMY IS DOING

  • WELL, SO WHEN THE FEDERAL

  • RESERVE INCREASES RATES, IT'S

  • GOING TO OBVIOUSLY AFFECT THE

  • MORTGAGE RATES, BUT OVERALL,

  • YOU'RE STILL SEEING PEOPLE THAT

  • ARE EXTREMELY OPTIMISTIC AND I

  • THINK IT'S ALSO VERY REGIONAL IN

  • STATES WHERE PRICES HAVE

  • INCREASED TREMENDOUSLY LIKE

  • TEXAS OR CALIFORNIA OR FLORIDA.

  • I THINK THAT YOU'RE GOING TO

  • BEGIN TO SEE THE HOME PRICES

  • STABILIZE A LITTLE BIT MORE BUT

  • OVERALL PEOPLE ARE VERY

  • OPTIMISTIC ABOUT THE ECONOMY AND

  • ABOUT HOUSING AND IT'S TIME TO

  • REALLY TAKE ADVANTAGE OF THESE

  • RATES NOW BEFORE THEY CONTINUE

  • TO GO UP BECAUSE A LOT OF

  • ECONOMISTS ARE SAYING WE'RE

  • PROBABLY GOING TO SEE THREE

  • DIFFERENT RATE HIKES THIS YEAR

  • ALONE SO TIME TO BUY BEFORE THEY

  • CONTINUE TO GO UP.

  • NEIL: THIS IS ONE OF MY OTHER

  • CRAZY THINGS.

  • I'VE NOTICED THIS ANECDOTALLY

  • BUT MORE AND MORE BUILDERS, BIG,

  • SMALL, INBETWEEN, WITH SPEC

  • HOUSES, IN OTHER WORDS THERE ARE

  • NO BUYERS FOR THEM BUT THEY'RE

  • BUILDING THEM AND I THINK FOR

  • WAS TABU THAT YOU JUST DIDN'T

  • RISK THAT BECAUSE YOU NEVER

  • NECESSARILY FIND A BUYER FOR

  • THAT, BUT I'M NOT JUST SEEING A

  • COUPLE I MEAN QUITE A FEW

  • POPPING UP AND I'M WONDERING FOR

  • THE BUILDERS DOING THAT THAT

  • THAT'S A GREAT SIGN OF

  • CONFIDENCE.

  • IS IT JUSTIFIED?

  • >> UH-HUH, I THINK THERE IS

  • EXTREME CONFIDENCE WITH HOME

  • BUILDERS NOW DAYS.

  • I THINK THESE HOME BUILDERS ALSO

  • REALIZE THE RENTAL MARKET IS

  • DOING EXTREMELY WELL SO IF THEY

  • DON'T END UP SELLING THESE

  • PROPERTIES A LOT DECIDE TO RENT

  • THEM.

  • YOU'RE ALSO SEEING THAT THE

  • RENTAL MARKET IS REALLY

  • INCENTIVIZING PEOPLE TO BUILD

  • MULTIFAMILY, THERE'S SUCH A HUGE

  • DEMAND FOR MULTIFAMILY AND

  • THERE'S NOT ENOUGH SUPPLY TO THE

  • POINT WHERE A LOT OF THE CAP

  • RATES IN THE MARKET JUST DON'T

  • MAKE SENSE YOU HAVE THESE LARGE

  • INSTITUTIONAL BUYERS THAT ARE

  • WANTING TO BUY MULTIFAMILY AND

  • IT'S EXTREMELY COMPETITIVE SO I

  • THINK HOME BUILDERS ARE

  • FOLLOWING SUIT WITH THE

  • CONFIDENCE AND NOTICING THE

  • RENTAL MARKET IS GOING TO

  • CONTINUE TO BE VERY SOLID SO

  • THEY ALWAYS HAVE A BACKUP PLAN

  • AND PEOPLE WANT NOW DAYS

  • EVERYBODY WANTS NEW AND THEY

  • WANT INSTANT GRATIFICATION, SO

  • THEY ARE VERY HAPPY WITH THESE

  • HOME BUILDERS AND PRODUCTS

  • THEY'RE OFFERING AND THERE'S

  • DEFINITELY BUYERS OUT THERE AND

  • MORE BUYERS WANT TO TAKE

  • ADVANTAGE BEFORE THESE RATES

  • CONTINUE TO GO UP.

  • NEIL: WELL THEY'RE PUTTING A LOT

  • OF GOODIES INTO THEM.

  • THIS MIGHT INTEREST YOU I DON'T

  • KNOW IF YOU'RE INTO BOCCI BALL

  • COURTS BUT A LOT WILL DO A BOCCI

  • BALL COURT FOR YOU I'LL

  • TELL YOU HOW TO TALK TO THE

NEIL: ALL RIGHT, WE TALKED ABOUT

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