Brian and David Wickert give you this week’s top mortgage and realty news, with advice to help get you into the home of your dreams.

This week on the Accunet Radio Show:

Brian and David discuss the federal rate cut, touch on Waukesha County’s hot condo market, and tell you why now is a great time to refinance your home.

This week’s highlights

• The Federal Reserve cut the federal funds rate by 0.25% this week, lowering it from 2.50% to 2.25%.
• June 2019 home-sellers lived in their homes for an average of 8.25 years — a record-setting high.
• Last week, Accunet hosted their 20th-anniversary bash, matching $6,500 of guest donations for a total of $13,000 for Milwaukee Habitat for Humanity!

The Federal Rate Cut — And what it means for you

This week, the Federal Reserve cut rates by a quarter-point, bringing the federal funds rate from 2.50% to 2.25%.

What is the federal funds rate?

The federal funds rate is the rate banks pay the federal reserve for parking money overnight. This specific rate is important because it influences the prime rate, which commercial banks use for their most creditworthy customers. It’s used for things like auto loans, personal loans, and most applicably, mortgages.

So, how do mortgage rates look now?

Well, despite the rate cut, mortgage rates experienced some upward pressure. Here’s why:

• The Federal Reserve said they’re not going to cut rates again this year, but also issues a statement saying they will “act as appropriate to sustain the expansion,” leaving the door open for more cuts.
• President Trump announced a 10% tariff on $300B of Chinese goods (starts Sept. 1)

Combined, these two factors pushed rates marginally higher. That being said, rates are still extremely low, meaning now is one of the best times in recent memory to refinance. Find out how much you could save with our refinance calculator, or contact Accunet for more information on how to pay less for the same house, and get started with your refinance today.

Waukesha County Condo Market

In the 5-county metro Milwaukee area, Milwaukee proper holds the vast majority of condo sales. However, Waukesha County is also a hot market. Brian recently had a client put an offer in on a condo in Waukesha County listed at $520,000, and it’s one of the strongest offers we’ve ever seen.

What made the offer strong?

• Offered $540,000 on a listing of $520,000 — $20,000 above asking!
• Offered a $200,000 down payment
• No home inspection contingency in the offer, since the property is only 3 years old
• Modified appraisal contingency so the condo only needed to appraise at or above $515,000

The outcome: Their offer was rejected, and we were shocked. This is probably the strongest offer someone can make on a home without saying, “I’ll pay you cash,” which we hypothesize the accepted offer did.
The lesson: The condo market is hot, hot, hot.

The value of overpaying for your home

It’s safe to say that overpaying on your offer makes you a more competitive buyer. Many of our clients have some trepidation about overpaying — but in the long run, it doesn’t hurt nearly as much as you’d think.
We recently had clients (a married couple) looking to put an offer down on a home within their price range that they fell in love with. Since they wanted the home so badly, we suggested they overpay to strengthen their offer, and did the math to prove how do-able it is:

Monthly payments on a 30-year fixed-rate loan…

$5,000 over asking: Increase by $24/month
$10,000 over asking: Increase by $48/month

The value of overpaying is that you’re leveraging borrowed money over a span of 30 years, meaning the payments are spaced out and painless.

Overpaying for the home of your dreams is absolutely worth it, especially when it’s only $24/month. We haven’t heard back on their offer just yet, but when we do, we’ll keep you updated.[elementor-template id=”10109″]