Rocket Fuel Newsletter – 07/01/2024

In addition to breakdancing making its debut in the Olympics this year, Peacock’s coverage will also include a personalized daily summary of results and highlights with an AI-trained model that replicates the voice of legendary broadcaster Al Michaels. Do you believe in miracles?

In this edition: summer fun and hot dog drama alongside our favorite topics of the last few years – housing affordability and home equity.

Fuel Up! 🚀  

Just How Difficult Is The U.S. Housing Market?

In what should come as no surprise to anyone currently working in the housing industry, recent research from the Harvard Joint Center for Housing Studies shows the gap between home prices and median income is making homeownership a more distant dream for many Americans.

According to the research, the monthly payment on a median-priced home is at its highest-ever four-quarter average at about $3,200. In addition, nearly half of metro areas now require at least $100,000 in annual income to afford an average home; this ratio was just 11% back in 2021.

Read more of the study here!

10 Years In Tuscany In Exchange For A Discounted Home?

With housing affordability still a major concern for many buyers and would-be sellers, perhaps it's time to move to the Italian countryside? The Italian government, looking to revitalize its smaller towns, is offering up to 30,000 Euros ($32,000) to anyone willing to move to a town of 5,000 or fewer people, as long as the residence is used as a primary residence ... and you intend to live there for 10 years.

Read more about your new retirement plan!

Two Hot Dog Eating Contests In One Year!

The Nathan's Famous Hot Dog Eating Contest won’t have the same star power it usually does this July 4 with the absence of Joey Chestnut – the winner of 16 of the last 17 hot dog titles. Fans of this tradition might have to wait until the Labor Day holiday for their fill of hot dogs when Chestnut will take on his longtime rival, Takeru Kobayashi, on Netflix, as both have been banned from the annual Coney Island competition.

Craig Smolen, Advantage Star Mortgage

Tell us about the beginning of your career. What got you started?

I was in the auto business for 22 years prior to making the switch. With lots of experience in the finance world, it was a natural transition to mortgage. The switch made a ton of sense.

Tell us about some of the biggest lessons you’ve learned in your tenure.

You always must pivot in this business. If refinances go away, focus on purchase (always focus on purchase) but don’t only focus on refi’s in the beginning, since the market is unpredictable. You must constantly adjust to what you have to do to stay busy and make sure you always are ready for things to change.

Also: only use Rocket.

What’s your favorite thing about being in this industry?

  1. I make my own hours and still don’t miss anything that I don’t want to miss. I have always liked doing finance and helping people get financing.
    1. Puzzles, and finding ways to get deals together. I enjoy the detective work of figuring the deal out so borrowers can accomplish their dreams of homeownership.

How do you want to grow your business?

Working with financial planners and elder law lawyers to help out their clients.

How would you describe your brand?

  1. A 5-star rating on Google – it’s very important to me.
    1. Many repeat customers and excellent referral business.
    1. Our availability. 24/7 and not 9-5.

What are you most excited about for the future?

Rates possibly settling down a little more and getting back to doing some refinance loans. It would bring more inventory in the market which makes people more inclined to sell their homes and move into a different home.

Why Rocket ProSM TPO?

  1. I`ve always had an excellent AE under the leadership of Dan Welch
    1. The ease of use in the portal and how simple the condition upload is
    1. The extra streps RKT takes that eases up our processing
    1. SOS is an excellent resource for my team and me
    1. The pricing engine is so easy and accurate
    1. Pricing is always consistently sharp; I do not feel like I’m having to pay for the excellent resources that they have.

In the past year, American homeowners saw a combined $1.5 trillion increase in their equity, nearly a 10% gain. The total equity for households currently sits at $32.7 trillion and has more than doubled since 2017.

Data from CoreLogic’s Q1 Homeowner Equity Insights paint a surprising picture of the state of equity in the U.S. today. 

For example, on average, homeowners have $304k in equity and rising. Over half of the states in the country have an average equity gain of over $20,000 year-over-year. Meanwhile, only seven states have less than a $10,000 increase in the past year.  

The increase in home values continues to be a key driver of the rise in equity, and most of the states with large price increases are seeing corresponding equity increases. 

Of the over $30 trillion in equity, $11 trillion of it is considered “tappable,” meaning the homeowner would be able to maintain at least 20% equity in their property. The average tappable equity per household is $206,000. This $11 trillion is worth more than the GDP of every country except for the United States and China.

While equity is a positive story for most – negative equity is still out there. Negative equity, commonly referred to as being underwater, occurs when a homeowner owes more on their mortgage than the current value of the home. In total, there is an approximate $320 billion in negative equity. At the peak of the great recession, 26% of mortgages were underwater. Current day, under 3% of mortgages are underwater.

Equity in homes remains an important thing for many and represents a substantial portion of homeowners’ net worth. By tapping into the equity, homeowners can source funds for major expenses like home improvements or it can be a safety net during times of emergencies. Leveraging home equity wisely can provide financial flexibility and peace of mind, making it a valuable asset in one's financial strategy.

Thank you to everyone who joined us for last week’s Pro Performance, “Move Buyers From No To Yes This Summer!”

Heading into peak buying season, attendees learned valuable strategies for building and maintaining broker-real estate agent relationships from Rocket Pro TPO Divisional Vice Presidents Feras Chihadeh and Dan Welch, and special guests Therese Antonelli and Tony Wright. Go out and sell with confidence this summer!

This image has an empty alt attribute; its file name is Weeds-Reads-1024x144.png
  1. FHFA House Price Index Up 6.3 Percent From Last Year
  2. Understanding The Recent Evolution Of Auto Loans By Income Level
  3. Mortgage Application Payments Decreased 1.6 Percent In May
  4. Unemployment Insurance Weekly Claims
  5. Big Banks Sail Through Stress Test In Harbinger For Payouts
This image has an empty alt attribute; its file name is Pro-Puzzles-1024x145.jpg

Brad Bailey and Jim ran away from the competition on last week’s puzzle as the only two to finish in less than a minute. Brad’s 35 seconds narrowly beat Jim’s time of 43 seconds.

This week’s puzzle gets 2 Rockets out of 5.

Click here to solve!

Good luck!