May 2023 – REI INK

Unleashing Potential: Mastering Free Skills for Success

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Rafael Zabala is a seasoned marketer who established his company through his brilliant ideas. He is the brains behind a game-changing company focused on online marketing and helping entrepreneurs make the most out of their marketing efforts through the use of technology, automation, and AI. Listen to this episode and don’t miss out on this chance to learn from a true visionary in the world of marketing and tech! Quotables “I think that it’s a mistake to, right off the bat, say that someone is going to take care of it for me because without you understanding it, then you don’t know what you’re getting.” “80% of success of all marketers is about creating a unique offer that communicates the value that you have to provide to your prospects.” “I’ve always believed in fail fast so you can move forward.” Links LinkedIn: Rafael Zabala https://www.linkedin.com/in/rafael-za… Website: Interactive Marketing https://www.interactivemarketing.net/… FREE Giveaway: Uncontested Investing Giveaway https://blnsurvey.typeform.com/to/Qwi… Website: RCN Capital https://www.rcncapital.com/podcast Website: REI INK https://rei-ink.com/

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Rental costs, a key component of the CPI, suggest further cooling in future inflation numbers The rate of monthly rental price increases for both single family rental properties and multifamily rental units trailed the consumer price index (CPI) and wage growth in the first quarter of 2023, according to data compiled by Beekin and analyzed by CJ Patrick Company. While the CPI rose 5.8% from Q1 2022 to Q1 2023, rents on multifamily rental units rose by only 3.34% and declined on single family rental properties by 2.72%. Of the 74 single family rental markets included in the analysis, only one – Savannah, GA – had a year-over-year increase higher than the CPI. Slightly more than 75% of the 174 multifamily markets analyzed showed rental prices increasing at a slower rate than the CPI. Similarly, only six of the single-family rental markets saw rates increase at a faster pace than the 4.30% year-over-year wage growth reported by BLS in their preliminary report of Average hourly earnings of employees on nonfarm payrolls. The multifamily market was more evenly divided, with 76 markets having rental rates increasing more rapidly than wages and 100 markets where wages grew more quickly than rent. “Today’s report provides some good news for prospective renters,” said Vidur Gupta, Founder and CEO of Beekin, a data analytics company. “Rate increases on rental units have slowed down considerably over the past year, and in many markets are actually lower than wage growth, which means improved affordability. This is particularly true in the single-family rental market, where list prices have declined slightly on a year-over-year basis.” “Since housing costs – rental rates in particular – are such a large component of the CPI, these trends suggest better times ahead for the U.S. economy,” said Rick Sharga, Founder & CEO of market intelligence firm CJ Patrick Company. “With listing prices for single-family rentals declining slightly and rates for multifamily rental units rising at a much slower pace than a year ago, the probability is that we’ll see better inflation numbers in the months ahead.” Single-Family Rental Growth Turns Negative Year-over-year list prices for single-family rental properties were less expensive than they were a year earlier in 49 of the 74 markets analyzed, and only exceeded three percent growth in eight markets: Savannah, GA (5.91%); Philadelphia, PA (5.75%); San Diego, CA (5.58%): Riverside-San Bernardino, CA (5.53%): Ocala, FL (4.89%): El Paso, TX (4.67%): Myrtle Beach, SC (3.50%): and Jackson, MI (3.26%). The markets with the largest price declines on a year-over-year basis all had list prices at least six percent lower than 2022 rates: Colorado Springs, CO (-9.75%); Clarksville, TN (-8.90%); Lakeland-Winter Haven, FL (-8.89%); Winston-Salem, NC (-8.88%): Birmingham, AL (-7.40%): Las Vegas, NV (-6.92%): Phoenix, AZ (-6.87%): Punta Gorda, FL (-6.86%); Kansas City, KS (-6.84%): Tucson, AZ (-6.69%): St. Louis, MO (-6.63%): Pittsburgh, PA (-6.09%): and Jacksonville, FL (-6.03%). “More recent comparisons are showing similar trends,” Gupta noted. “Looking at rental listing data on a quarter-over-quarter basis, single family rental rates declined by -0.34% and multifamily unit rates rose slightly by 1.0%. Both of these were lower than CPI growth of 1.04% for the quarter, although the multifamily list price increase was slightly higher than the 0.85% wage growth in Q1.” Multifamily Rental Unit Rates Continue to Rise, but More Slowly Only eight of the 174 markets included in the Q1 2023 analysis showed double digit year-over-year growth in rental listing prices, with seven of the eight in the South and Southeast: Fayetteville, AR (14.14%); Santa Fe, NM (12.53%); Knoxville, TN (11.13%); Daytona Beach, FL (10.85%); Santa Barbara, CA (10.69%); Savannah, GA (10.58%); and Athens, GA (10.15%). Meanwhile 14 markets had declining list prices compared to Q1 2022: Clarksville, TN (-21.36%); Bremerton, WA (-5.29%); Winston-Salem, NC (-4.98%): Las Vegas, NV (-3.85%); Wichita, KS (-3.69%); Dayton, OK (-3.44%); Coeur d’Alene, ID (-3.06%); Atlantic City, NJ (-2.82%); Cleveland, OH (-1.52%); Boise City, ID (-1.27%); Spokane, WA (-0.61%); San Francisco, CA (-0.46%); Grand Forks, ND (-0.32%); and Eau Claire, WI (-0.29%). “It’s probably worth noting that many of the markets experiencing year-over-year declines in both single family and multifamily rental list prices are also markets that had the most explosive growth during the early stages of the COVID-19 pandemic,” Sharga added. “We’ve seen similar trends in the owner-occupied housing market, where metro areas like Phoenix and Boise are experiencing declines in both home sales and prices.” Methodology Beekin used same-store data on more than 12MM unique single family homes and multifamily units, beginning in 2015. Using interpolation methods similar to those used by the Bureau of Labor Statistics for the Consumer Price Index, it was able to infer rent growth at a national, state and local level for over 170 MSAs across the country. Wage data is sourced from the Bureau of Labor Statistics report on average hourly earnings of non-farm employees. About Beekin Beekin is a Decision Intelligence platform for rental housing. By leveraging cutting edge AI and data, Beekin’s patented solution suites help with underwriting, asset management, and capital markets for some of the largest lenders and asset managers. For more information, please visit Beekin.co. About CJ Patrick Company Founded in 2019, CJ Patrick Company is a Market Intelligence and Business Advisory firm working with companies in the real estate and mortgage industries. Founder & CEO Rick Sharga is one of the industry’s most quoted resources on real estate, mortgage and foreclosure trends and has held executive leadership positions with companies such as ATTOM Data, Auction.com, Carrington Mortgage Holdings, and RealtyTrac. Visit www.cjpatrick.com for more information. Media Contacts vidur@beekin.co Rick.Sharga@cjpatrick.com

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Buyers still aggressive on acquisitions but shifting toward hold-for-rent strategy 77 percent of buyers are local community developers, owner-occupants doubled Auction.com, the nation’s leading distressed real estate marketplace, released its 2023 Buyer Insights report, which shows nearly one-third (32 percent) of buyers surveyed expect home prices to decline in their local housing market in 2023, nearly double the 17 percent who expected home prices to decline in 2022. Buyer Insights report findings are based on a March 2023 survey of nearly 450 distressed property buyers from across the country who have used Auction.com to purchase homes at foreclosure auction or bank-owned (REO) auction in the last four years. “Local community developers buying at distressed property auction are on the frontlines of the housing market and provide a reliable barometer for emerging real estate trends,” said Jason Allnutt, Auction.com CEO. “They are telling us 2023 will bring further home price declines in many areas but also increased opportunities to convert distressed properties into affordable housing supply as prices adjust to a new market-driven equilibrium.” More than nine in 10 buyers surveyed (92 percent) described themselves as either local community developers (77 percent) or owner-occupant buyers (15 percent). The owner-occupant share of buyers nearly doubled from 8 percent in the 2022 survey. Separate sales data from Auction.com shows that 82 percent of properties purchased on the platform in 2022 were within 100 miles of the buyer’s mailing address. The median distance between buyers and properties was 15 miles for homes sold at foreclosure auction and 21 miles for homes sold at REO auction. “We have a lot of military buyers here and it’s hard to find them affordable, updated homes in a timely manner,” said Julie, a New Mexico-based buyer. “My investing is helping provide renovated, updated homes to people that would have to rent otherwise.” Buyers most bearish and opportunistic in West and Southeast Buyers located in the West region of the country were the most bearish about home price appreciation in 2023, with 43 percent saying they expect home prices to decline for the year. That was up from just 7 percent in the 2022 buyer survey, and it was the highest percentage of any U.S. region. Thirty-seven percent of buyers in the Southeast region said they expect home prices to decline in their local markets, the second highest percentage among the U.S. regions and up from 12 percent in the 2022 survey. Despite rising expectations for a home price correction in 2023, 87 percent of buyers said they planned to increase or keep the same their property acquisitions for the year, up slightly from 86 percent in 2022. “Right now, we’re very, very bullish, but cautiously bullish, too, because I don’t know what events are going to come in that could throw a monkey wrench into my plans,” said Paul, a Florida-based buyer who purchases properties at REO auction. Buyers were most aggressive in terms of 2023 acquisition expectations in the West and Southeast regions — the two regions with the highest share of buyers expecting a home price correction in 2023. Ninety percent of buyers in both regions said they expect property purchases to increase or remain the same in 2023. More buyers shifting to renovate-and-rent strategy More distressed buyers are shifting to a renovate-and-rent investing strategy in the slowing 2023 market even while renovate-and-resell remains the dominant strategy. Half of all buyers surveyed said that renovating and reselling to owner-occupants was their primary investing strategy, down from 61 percent in 2022. Meanwhile, 39 percent of buyers surveyed said renovating and holding for rental was their primary investing strategy, up from 32 percent in the 2022 survey. “(My investing is) providing income to a lot of people and providing affordable rental properties to the community,” said Grace, a California-based buyer. Nearly nine in 10 buyers surveyed (88 percent) said they typically spend $10,000 or more for renovations on properties purchased on Auction.com. Nearly half (47 percent) said they typically spend between $20,000 and $50,000 on renovations. The average sales price for properties sold on Auction.com in 2022 was $178,000. The typical renovation budget skewed slightly higher for buyers whose primary investing strategy is reselling to owner-occupants: 53 percent of those buyers spend between $20,000 and $50,000 on a typical renovation compared to 46 percent for buyers whose primary strategy is holding for rental. “We put finishes in homes that we would like to have in our own homes,” said Kristen, a Massachusetts-based buyer. “We want those purchasing our homes to love the quality and design of the home and not need to do any additional work. We always look for the hidden things that need to be fixed or changed and never settle for shoddy construction.” Neighborhood stabilization an important motivation A majority of buyers ranked “Making Money” and “Building Generational Wealth” as one of their top three motivations for investing in real estate. “A single mother for many years, … investing affords me financial independence with a goal of creating a solid platform for my sons,” said Kerry, an Alabama-based buyer. Nearly half of buyers (47 percent) ranked “Improving Neighborhoods” as a top-three motivation while both “Expanding Homeownership” and “Providing Affordable Housing” were top-three motivations for more than one-third (38 percent) of buyers surveyed. “I pay the closing costs for veterans, first responders, and educators to help expand home ownership among these groups,” said George, a Texas-based buyer. More than 200 of the 448 buyers surveyed provided a short story of how their investing is helping communities through an optional open-ended question at the end of the survey. About Auction.com Auction.com is the nation’s leading online marketplace for the disposition of distressed residential properties. The company goes beyond traditional disposition programs, offering tools and services that stabilize neighborhoods, expand homeownership, maximize sales, shorten the sales cycle, yield higher returns, mitigate risks and elevate results. Our seller strategy includes customized and flexible programs, data intelligence and buyer insights, and pioneering technology. This includes Remote Bid®, which expands the buyer base nationwide by

MANAGING WORK LIFE BALANCE

by REI Podcast - RCN Capital
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Anthony and Candace Coffey are the owners of Faithful Homebuyers KC. In this episode, we are talking about what it really is like to run a business with your spouse – the challenges, what happens behind the scenes, and how you can grow to become more supportive and respectful of one another in what you do. Listen to this episode to learn how Anthony and Candace discovered how they can work in business together and how they learned how to separate work and home life to become successful! Quotables “She’s right – we are better together, we are stronger together. She runs a side of the company that I don’t want to touch and vice versa.” “It’s really important to shut that line off between work when you walk into the doors, it’s just home life now.” “We love what we do. We don’t win all the time, but this is, this is great and we learn everything every time.” Links Website: Faithful Home Buyers KC https://www.faithfulhomebuyerskc.com/ Social Media: Faithful Home Buyers KC https://www.facebook.com/FHOMEBUYERSKC https://www.instagram.com/faithfulhom… Email: anthonycoffey@gmail.com faithfulhombuyerskc@gmail.com

It’s a Numbers Game in a People Business

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Will Wright is a third-generation Realtor in Fort Worth who has specialized in DFW valuations for over 10 years. In this episode, Will talks about his journey in the real estate space and the importance of building connections for real estate investors, especially those who are just starting out. Listen now to learn why real estate revolves around relationships and how building the right ones will help you succeed! Quotables “Don’t forget the power of connection in this industry, it is a people industry first.” “We are a for profit business but at the end of the day, we have taken the approach of I’m here, I’m from here, and how can I help you.” “What we’re good at, what we’re not good at, what we want to do, what we don’t want to do, and it sounds like now you’ve found a better position, doing things that you do want to do with the people that you trust who pour gas on your skill level as opposed to just pouring tasks on top of you.” Links Facebook: Will Wright https://www.facebook.com/thewillwrigh… Website: RCN Capital https://www.rcncapital.com/podcast Website: REI INK https://rei-ink.com/

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Monthly housing payments hit a new record high this week as mortgage rates jumped, pricing out many homebuyers, especially those with limited budgets Housing payments hit a new high this week as mortgage rates jumped due to progress on a possible debt-ceiling deal. That’s according to a new report from Redfin (redfin.com), the technology-powered real estate brokerage. Daily average rates hit 7.12% on May 25, reaching their highest level since November. The typical U.S. homebuyer’s monthly mortgage payment hit a record-high $2,614 at a 6.57% mortgage rate, the current weekly average. The rate increase dampened homebuying demand. Pending home sales dropped 17.4% nationwide from a year earlier during the four weeks ending May 21, the second-biggest dip since January (the biggest was a 17.5% decline in early April). Mortgage-purchase applications declined too, dropping 4% from the week before. Potential sellers continued backing off, with new listings of homes for sale dropping 24%, one of the biggest declines since May 2020. That’s because homeowners continue to hang onto their homes, locked in by comparatively low rates. Even though demand is down, it’s still outpacing supply as the new-listing drought has caused the total number of homes for sale to post an annual decline (-0.9% YoY) for the first time in nearly a year. Despite rates jumping past 7% and a lack of new listings, many early-stage homebuyers remain committed. Redfin’s Homebuyer Demand Index, which measures requests for tours and other services from Redfin agents, increased from a week earlier and is essentially flat (-1%) from a year earlier. Some of these house hunters are likely to continue moving forward, while others may wait for rates to decline before securing loans. We may see a burst of pent-up demand when and if rates dip again. “People may be wondering why rates are surging as we come up against a potential debt crisis. Right now, the way investors are reacting is the driving force. Mortgage rates have increased over the past two weeks because it looks more likely that the U.S. government will avoid hitting the debt ceiling,” said Redfin Economics Research Lead Chen Zhao. “That may seem counterintuitive, but optimism is driving rates up because an economic crisis would lead to the Fed lowering rates as they try to prevent a recession. Financial markets felt the risk of default was unusually high for the last month or so, which caused rates to stay lower than they otherwise would have been. Now that Democrats and Republicans have come to the negotiating table and are making some progress toward a deal, rates are going up.” Mortgage rates passing 7% have varying impacts on homebuyers: Some are priced out, others are unfazed In the Seattle area, different buyers are reacting differently to mortgage rates surpassing 7%. Redfin Premier agent Hal Bennett, who works with buyers and sellers in pricey eastside suburbs like Bellevue and Sammamish, said buyers are shying away this week as rates tick past the 7% mark. But Bliss Ong, a Redfin Premier agent who works mainly in the city of Seattle, says the 7% number doesn’t present the same psychological barrier for her buyers that it did back in fall 2022. “Rates hitting 7% is pushing some homebuyers entirely out of the market, especially those with lower budgets. But a lot of them are just pushing their price range down,” Ong said. “The 7% number isn’t scaring away buyers as much as it did back in the fall. The housing market is different now because buyers are used to rates in the 6% range, and some of them are even motivated to secure a loan now in case rates rise further.” Jacksonville, FL Redfin Premier agent Heather Kruayai reports that in her area, it’s the most expensive homes that are most popular in today’s market. “Affordable listings are getting stale, but expensive ones are selling quickly. That’s usually because those buyers can lessen the impact of high rates by making huge down payments or paying in all cash,” Kruayai said. “Other than cash buyers moving in from out of town, the only people buying and selling are the people who need to because they’re retiring or going through another major life change.” Leading indicators of homebuying activity: Key housing market takeaways for 400+ U.S. metro areas: Unless otherwise noted, this data covers the four-week period ending May 21. Redfin’s weekly housing market data goes back through 2015. For bullets that include metro-level breakdowns, Redfin analyzed the 50 most populous U.S. metros. Select metros may be excluded from time to time to ensure data accuracy. To view the full report, including charts, please visit: https://www.redfin.com/news/housing-market-update-pending-sales-drop-mortgage-rates-pass-7