What Is Actually Happening in the Houston Market This Week

Happy Monday Houston. Rich Bonn at Habayit Home Loans is breaking down what is happening in the local market and the mortgage world so you can make smart decisions with what is actually in front of you right now.

The Activity Numbers and What They Mean for Buyers

The market is slow and that is not a problem for buyers. It is an opportunity.

Closings are down one and a half percent. Showings are down five and a half percent. New listings are down three percent. Pending listings are down twenty-three percent. Off-market listings are down about fourteen percent. Less activity across the board means less competition and less competition means more room to negotiate.

The smart buyer looks at those numbers and sees leverage. Sellers who are not receiving the offers they expected are more willing to contribute toward closing costs, reduce the price, or offer a combination of both. And Rich makes a point worth internalizing. You can only negotiate until you have purchased the home. Six months after closing you cannot go back to the seller and ask for more money off. The negotiating window is open right now while conditions favor the buyer. That window does not stay open indefinitely.

If you are waiting for rates to drop remember what happened in 2020 and 2021 when buyers were paying well over list price in a frenzy of competition. That is what a rate improvement brings with it. More competition, higher prices, and less room to negotiate the kind of deal that is available to buyers right now.

That said negotiating realistically matters. A seller in a slower market is motivated but not desperate. Coming in at an unreasonable discount is still going to get a no. The opportunity is in reasonable negotiation with motivated sellers, not in low-ball offers that go nowhere.

The Rise in Foreclosures and What It Means

The foreclosure moratorium is officially over. That shift is worth watching as it works its way through the market over the coming months.

The Down Payment Myth That Is Keeping Renters Out of Homes

A CNBC Survey Monkey study found that approximately eighty-seven percent of renters want to own a home but do not know where their down payment is going to come from. Rich has a direct observation about why. Most of them believe they need twenty percent down.

They do not. Conventional loan programs start as low as three percent down for qualifying borrowers. FHA programs are available at three and a half percent down. Bank statement loan programs for self-employed borrowers can go as low as ten percent in many cases. The twenty percent requirement is a myth that is keeping qualified buyers from even starting the conversation.

What Self-Employed Buyers Need to Know Right Now

Initial jobless claims fell two thousand this week meaning two thousand fewer people filed for unemployment. That is a positive data point though its sustainability bears watching in the months ahead.

For self-employed buyers this market may be as favorable as it gets right now. Negotiable sellers. Strong non-QM loan programs. And the ability to qualify based on actual income rather than what the tax return shows after a fully optimized deduction strategy.

Using tax returns to measure a self-employed borrower’s income is like using a fork to measure a cup of flour. It is the wrong tool for the job. Bank statement loans, profit and loss loans, and other non-QM programs are built specifically to measure self-employed income the right way and qualify borrowers based on what they actually earn.

Have a great week Houston. Reach out to Rich Bonn at Habayit Home Loans at 281-841-1723 to talk through what is available for your specific situation right now.

Sources

HoustonAssociationofRealtors.com
MortgageNewsDaily.com
CNBC.com
ConsumerFinancialProtectionBureau.gov
Investopedia.com