Stocks Are Still Rising

Volume 14 Issue 8 August 2020

W

e have just finished one

of -- if not

the weakest

-- quarter in

history. The corona virus is

still raging. Millions have

lost their jobs. Yet the stock

market continues to rise,

recovering from its lows hit

early this year. Thus, the

question is -- why?

There are many possible explanations

for the equity market's resilience, but we

will pick just two of these. First, the

markets are not looking at today, but the

future. And those buying stocks are pre-

dicting a brighter future. To that end, the

stock market has a history of doing well

in troubled times, with

many analysts citing 1968

as an example. The year

1968 was a year of escalat-

ing war, assassinations,

civil unrest and more. Yet

stocks that year rose al-

most 8.0%.

Secondly, the medicine the

Fed Reserve has applied to

the system favors stocks. Record low

rates discourage investors from parking

cash. They are looking for greater re-

turns and, in the long run, stocks have

In This Issue P2 Real Estate Tops The List || P2 What Millennials Want

P3 Stocks Are Still Rising || P4 Record Low Rates Spur Refinancing

Selected Interest Rates July 23, 2020

30 Year Mortgages——–3..01%

2019 High (Jan 3 %

2019 Low (Sept 5) ——–—3.49%

15 Year Mortgages——-2.54%

5/1 Hybrid ARMs——–—–3.09%

10 Year Treasuries—–—–0.50%

Sources—Fed Reserve, Freddie Mac

Note: Average rates do not include fees and points. Information is provided for indicating trends only and should not be used for comparison purposes.

Continued on Page 3

THIS NEWSLETTER IS BROUGHT TO YOU BY:

John Doe

Senior Loan Officer Ajax Mortgage

111 Mortgage Way

Mortgagetown, MD, 11111

(301) 555-1212

(800) 555-5555

Ajaxmrtg.com

Specializing in

� Residential

Purchases

� Residential

Refinances

� Commercial

Properties

� Home Equity

Loans

Did You Know…

Around one-in-five adults in the US have either moved or know someone who did because of the Covid-19 out-break, according to a study by the Pew Research Center. While many of those who moved were students were forced to leave when their campus shut down, 28% of US adults who relocated said they moved to reduce their risk of contracting the virus.

What Millennials Want...

Page Two

“…young buyers are somewhat particular…”

Real Estate

Tops The List F

or most Americans, homeown-ership remains an integral part of an otherwise shifting inter-

pretation of the Ameri-can Dream. Nearly 90 percent of Millennials – a group known for their tendency to rent in the city the longest – plan to purchase their own place at some point.

The key difference between Millennials and prior generations is that young peo-ple view homeownership as a personal lifestyle choice rather than a definite milestone. As such, young home buyers are somewhat particular when it comes to their dream home must-haves.

Per a survey conducted by Trulia and Harris Poll, 72 percent of renters ages 18 to 34 plan to buy a home in the future. In preparation of this new wave of home buyers, consider where young people want to live and the home fea-tures they desire most.

Tiny Homes: Still a Niche Market

While a sustainable and efficient house-hold lifestyle is gaining in popularity, most buyers don’t see a tiny house as the ideal option. Forty-four percent of

all buyers (regardless of age) prefer a home between 1,401 and 2,600 square

feet – a size that holds two to four bedrooms, depend-ing on property type. One-

third of Millennials aren’t sure of how big they want their dream home to be, but 20 percent say 2,001 and 2,600 square feet is ideal. That’s much larger than the typical tiny home, which ranges between 400 and

1,000 square feet, on average.

Modern Beats Traditional

Baby Boomers traditionally favor single-story homes, but both Gen X and Mil-lennial home buyers prefer a more mod-ern aesthetic and layout. Anecdotal evi-dence also suggests that young people wish for move-in ready interiors instead of do-it-yourself (DIY) updates and large remodeling projects. Hardwood floors, granite countertops, stainless steel appliances and layout efficiency regularly make a lasting impression on young house hunters. Aside from mod-ern architecture styles, Millennials also like Victorian or Craftsman homes. And, despite their city-driven lifestyles, just 6 percent of Millennials see them-selves purchasing a high-rise penthouse apartment.

R

eal estate continues to

rank at the top of the

list of the best long-

term investments for

Americans, according to the lat-

est annual poll from Gallup.

About 35% of Americans picked

it as their favorite investment,

hich has been the case since

2013.

Meanwhile, Americans are less

likely to view stocks or mutual

funds as the best long-term in-

vestment, particularly waning

after the COVID-19 pandemic

struck the economy this spring.

Twenty-one percent of Ameri-

cans picked stocks as the best

investment, down 6 percentage

points from a year ago and at the

lowest reading since Gallup

started collecting such data in

2012.

Only about one in six Americans

view savings accounts or CDs

(17%) and gold (16%) as their

favored long-term investment.

During the financial crisis of a

decade ago, real estate was

viewed as more risky, and gold

finished first as the best long-

term investment during that time.

But as real estate values continue

to climb in recent years, gold has

faded and real estate’s invest-

ment potential has steadily risen

in popularity....

Source: Gallup.com

Page Three

...In a Home Stocks Are

Still Rising

Continued from Page 1

provided those returns. You might

ask, what about the average

American, who is likely to be a bit

more risk-averse in today's chal-

lenging environment? Are consum-

ers that bullish on the stock market?

We would argue that the average

American is also bullish about the

future. But they are taking the Fed's

medicine and using it to purchase

homes instead of stocks. If you

want to look at one investment that

is even hotter than stocks, it is real

estate. Recently, a Gallup poll con-

firmed this concept.

The poll showed that real estate

was the number one long-term in-

vestment favored by Americans and

stocks came in a distant second.

Thus, the big institutions are buying

stocks, but the average consumer is

putting their money in a place they

can call home -- at record low

rates...

“…the average

consumer is putting their money in a

place…”

©2020, All rights reserved

The Hershman Group www.originationpro.com

1-800/581-5678

Headed to the Suburbs

Most Americans would rather live in the countryside (27 percent) or suburbs (27 percent) over a major metropolitan city (8 percent). For Millennials, though, exact location isn’t as im-portant. Young people prioritize a shorter work commute and top-notch school districts first, putting less em-phasis on any specific address. Howev-er, when it comes to traffic, living near the urban core often minimizes work travel time.

Kitchens and Open Concept

Millennials’ biggest dream home fea-ture is having a balcony with a view (60 percent) and terraces are far more prev-alent in multi-family buildings near the urban core. Other must-haves among Millennials include a backyard deck (59 percent), gourmet kitchen (53 percent), swimming pool (52 percent) and open floor plan (45 percent). Across genera

tions, home buyers crave gourmet kitchens and open concepts most often.

While house hunting preferences differ across generations, Millennials’ must-have lists aren’t always practical. Us-ing a home affordability calculator helps young buyers understand what they can afford, despite their predispo-sitions, and keeps expectations in line with the budget. From there, mortgage preapproval and an open mind go a long way in creating a smoother and more successful first-time home buy-ing experience...

Source: Trulia

Record Low Rates Spur Refinancing

Joe Customer Joe’s Appliance Center 111 Center Way Drive

Suite 1005

Happyville, VA 20000

Address Correction Requested

In This Issue:

Stocks Are Still Rising

John Doe

Senior Loan Officer

Ajax Mortgage

111 Mortgage Way

Mortgagetown, MD, 11111

(301) 555-1212

(800) 555-5555

Ajaxmrtg.com

My goal is to provide expert

advice and direction for my clients with an overall goal of

providing a real estate finance

transaction that exceeds their

goals and expectations.

— John Doe Senior Loan

Officer

R

ates on home loans have fallen to new all-time lows so many times

this year that it's almost getting routine. "Really? Again?" But if

you're a homeowner, don't let me catch you yawning, or shrugging

off these milestones. Because a new record low means there are

more old loans out there that are worth refinancing at lower interest — maybe

including your current loan.

Thanks to the latest new floor for rates, more than 16 million homeowners with

financing are now good refi candidates and are missing out on hundreds of

dollars in savings per month, according to a report released by the mortgage

data firm Black Knight. Rates on home loans have been falling steadily amid

the financial turmoil touched off by the coronavirus, and they've now hit new

record lows several times since early March.

But the latest levels have expanded the field of potential refinancers like never

before, Black Knight says. A record 16.3 million homeowners now have an

incentive to refinance and could cut their payments by an average $283 a

month. And, you might do even better than the average: 4.6 million could save

at least $300 per month by refinancing, and 2.6 million would save $400 or

more each month, the research says. You're considered a good candidate for a

refi if you can shave at least three-quarters of a point — 0.75 — off your cur-

rent rate...

Source: MSN/Money