The FED said something BIG this week.

It’s even more impactful than a rate cut would have been…. 

I got some heat on last week’s vlog, so if you missed it and you like drama – you should go check it out.  This week was a Fed Meeting Week and none of us were really holding our breath for a cut. With all the new inflation concerns, it was unlikely the Fed was going to do anything but continue their pause. There were some whispers that maybe the instability gripping the stock market or collateral damage from Trump’s Trade War would cause Powell and his pals enough concern about a looming Recession that they would do something…and they did! 

Policy Uncertainty 

Here’s the big news from the Fed Announcement that in my opinion is not getting enough attention. They are going to reduce the runoff on their balance sheet from $25B a month to $5B.  HUGE DIFFERENCE. This is great news for the bond market because it’s a lot less treasuries that have to be absorbed by the market. As you know, mortgage interest rates are driven by the demand for bonds. What the Fed is going to do will ease the supply of bonds, which is really great news for interest rates. 

This is how the Fed can reduce borrowing costs in the face of increasing inflation risks and overall economic chaos without breaking the labor market. I know Powell gets a lot of hate from real estate folks and even Trump, but this seems like a pretty slick strategy if you ask me. It’s also another reason you need to pay attention to a potential recession and the opportunities it might bring in real estate. 

Market Dynamics 

The real estate market here in Reno has been basically shifting non-stop for the past 18 months. Activity has definitely picked up since Martin Luther King Day in January. I specifically remember that because it was pretty quiet in December and the first half of January but that three-day weekend, I worked non-stop and ever since we’ve been opening new escrows every week. 

There are some new patterns I’ve been running into in terms of challenges with these escrows as well. Sandi and I are going to go over these on the next Property Pursuits, which will be April 2th.  To give you a little teaser, you’ll want to start shopping for homeowner’s insurance earlier, you’ll want to make sure your lender is aware of any unique characteristics on the property and in almost all scenarios – now is not the time to be waiving inspection or appraisal contingencies. 

Save the Dates 

I’ll be teaching a class on April 1st with Trevor Richardson, the broker owner of Address Income. He’s going to share the market analysis tools that have previously only been accessible by his agents and their buyers. I’ve used these tools to analyze and purchase investment properties, so I know exactly how powerful they are…and honestly how wild it is that he’s going to share it with all agents, regardless of their brokerage. Then I’m going to show you how you can use that data and those analytics to tweak your buyer consultation and listing presentation so you can better own your authority. This will improve your conversion in a big way, friends. This is a local, in person class so if you are a realtor in Reno – let me know if you’d like me to save you a spot. 

Then on April 9, my dead friend Cortney Young is teaching a negotiation class.  This one is virtual, so you are welcome to join us from anywhere. Cortney’s class is not specific to realtors, so be sure to share it with anyone you know who wants to be better at articulating their worth and conflict resolution.  

Both events are free, all you have to do is reserve a spot.