11.04.24
Written by Chase Majerus
Everything Election-related
Welcome to This Week Today, the housing and finance newsletter that knows we’re all knee-deep in election talk but prefers to keep it low on the anger and high on the insight. This issue is dedicated to everything election-related, from the headlines to the what’s-nexts—minus the rage spirals. But hey, we’re not completely immune to some stupid jokes. We’re just normal average Americans after all. So if you’re ready to get the scoop without the stress, read on—it’s election time with a wink, not a roar.
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Today's Agenda:
A Quick Link to the article of your choice
S1L Home Equity Loan
Use Your Home For The Best Future Gains
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Keychain
Election Response
Last week saw a powerful rally in the stock market and an unexpected Fed rate cut, driven by Donald Trump’s victory in the presidential election.
The election results boosted market confidence, with the S&P 500 and Nasdaq reaching record highs and the Dow topping 44,000 for the first time. Gains were led by sectors like consumer discretionary, energy, and finance. Major players like Wells Fargo and Morgan Stanley surged.
U.S. mortgage rates went up, driven by a surge in the 10-year Treasury yield, reaching 7.13% for a 30-year fixed mortgage. This increase has led to a drop in housing stocks, with companies like Lennar, D.R. Horton, and Home Depot all seeing declines.
Here’s a little Mortgage 101: Higher mortgage rates make home purchases more expensive. So with mortgage rates going up, a $400,000 mortgage now costs $216 more per month than in early September. But somehow that doesn’t change a dang thang, existing home sales have risen due to higher inventory levels. So what about future of mortgage rates? As pretty much always, it will depend on inflation, economic performance, and Treasury issuance.
Which is a great time to say that this week’s focus shifts to key economic reports, especially inflation data and consumer spending, which will signal the economy’s trajectory heading into the holiday season.
TARIFFS AND HOMEBUILDING COSTS
Now that Donald Trump has been elected, one of the first things that US economists are grappling with is the President’s very publicly proposed tariffs on imports. This includes significant hikes for goods from China and Mexico which could further increase U.S. homebuilding costs.
And look, these are just assumptions based on the trends from his previous term, when tariffs on Canadian lumber led to steep rises in construction costs. Current tariffs on Canadian lumber under the Biden administration have already tightened supply and increased prices, impacting housing affordability.
Economists warn that a 10% universal tariff could raise inflation by nearly a percentage point, placing extra pressure on U.S. manufacturers and consumers.
Housing Affordability and Deportation
Strange heading, right? Stay with me on this one…
President-elect Donald Trump claims deporting millions of immigrants will reduce housing costs, blaming high prices on a housing shortage fueled by immigration.
But experts say that immigrants actually play a major role in the construction workforce, and mass deportations could lead to higher building costs and longer construction delays. With nearly a third of construction workers being immigrants, reduced labor would likely worsen the housing shortage rather than improve it.
Major Manor
The White House
Come on, it’s an election special newsletter, we HAVE to talk about the White House right??
- Valued at nearly $400 million (in 2017 Zillow appraised the residence for $397.9 million. According to the real estate marketplace, monthly rental payments would be just over $2 million a month)
- eatures a 42-seat movie theater and a tennis and basketball court (the White House bowling alley was given as a gift to President Truman and was later moved to the basement of the Eisenhower Executive Office Building)
- 55,000 square feet, 132 rooms, 35 bathrooms, 6 stories, 412 doors, 147 windows, 28 fireplaces, 8 staircases, 3 elevators
- It takes 570 gallons of white paint to cover the exterior of just the residence portion of the White House (center), excluding the West and East Wings
- The White House was officially named “The White House” by President Theodore Roosevelt in 1901. Before that designation, it was referred to as the “President’s Palace,” “Executive Mansion” and the “President’s House.”
Financial Fitness
Renting vs. Buying
I’ll start off by sharing with you one of the most comprehensive YouTube videos about renting vs. buying, produced by none other than Ramit Sethi.
If you’re unfamiliar with Ramit Sethi, he’s a prominent American personal finance advisor, entrepreneur, and author, best known for his 2009 New York Times bestseller, I Will Teach You to Be Rich. He founded the website IWillTeachYouToBeRich.com, where he shares insights on personal finance, business, and psychology. You may even have heard of his show on Netflix called… How to Get Rich.
I think you get the point.
One of the most age old financial questions remains though, should you rent or should you buy a home/condo/townhome/whatever. I have a simple answer: it depends on your specific financial situation.
And you can find out, in great detail, about your specific financial situation using a really easy to use app. In fact, the whole point of this app is to figure out your mortgage readiness.
It’s called S1 FinFit.
You can use S1 FinFit to:
- Get free credit monitoring and alerts
- Set financial goals, create budgets, and track your progress
- View your bank accounts, credit cards, car loans, student loans, retirement, and investment accounts in one place
investment accounts in one place
- Keep track of your spending to see where your money is going
- Monitor the value and equity in your home (if you’re already a homeowner)
- Access financial tips and best practices
- BUT MOST IMPORTANTLY, DETERMINE YOUR MORTGAGE READINESS
Download here. Need we say more?
S1 FinFit App
Digital financial assistant at your fingertips
S1 FinFit is a FREE app that provides a roadmap to help you reach your financial and lifestyle goals, no matter how big or small! Free credit monitoring with alerts, set financial goals, create budgets, and keep track of your spending to see where your money is going.
Download the app on the appropriate app store with the links below!
Vlog
Pre-Qualification vs. Pre-Approval
If you’re thinking about buying a home, you’ve probably heard the terms pre-qualification and pre-approval. They sound similar, but they’re far from interchangeable. In fact, understanding the difference could be the key to landing your dream home.
The Trap of Pre-Qualification
Picture this: you sit down at your computer, open up a mortgage website, and punch in a few numbers—your income, estimated debt, and maybe a couple of other details. Minutes later, you get an email with your pre-qualification letter. Sounds official, right?
Well, that letter? Not worth much more than the paper it’s printed on. Pre-qualification is based on self-reported information, not verified details. You haven’t shown any pay stubs, tax returns, or bank statements. A lender hasn’t done a credit check. It’s the equivalent of a quick estimate, not a true approval.
Think of pre-qualification as a soft pass, a preliminary step that’s convenient but lacks depth. It can give you a rough idea of what you might qualify for, but it won’t impress any sellers or guarantee a mortgage.
The Power of Pre-Approval
If you’re serious about buying, pre-approval is the route to go. A pre-approval means sending a local, direct lender everything they need to understand your financial situation. Pay stubs, W-2s, bank statements—you name it, they’ll review it. You’ll also go through a soft credit check, which gives them a fuller picture of your creditworthiness.
Unlike pre-qualification, pre-approval is a thorough examination of your finances. Your lender verifies all your information and, if everything checks out, issues a letter of pre-approval. This letter tells sellers you’re a well-qualified buyer, ready to close the deal. It can often mean the difference between having an offer accepted or losing out to another buyer.
Want to learn more about the ins and outs of pre-approval?
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