Welcome to the Pocket List, investors 👋

Let’s make some money today, shall we?

First, let’s check in on mortgage rates…

The 411 on rates… Rates fell dramatically this week. The Fed didn’t lower rates but hinted that a cut was on the table for September if inflation data cooperates.

THE LEAD

D-Day is coming

Do you smell that?

The changes stemming from the NAR settlement go live on August 17th. Don’t say I didn’t warn you.

Wait, what NAR settlement?

In case you’ve been living under a rock, the real estate industry is about to undergo the biggest changes in a century.

Per the new normal, agents will require buyers to sign a contract before showing them properties. Oh, and the Multiple Listing Service (MLS) will no longer display the commission a buyer’s agent will receive if they sell a house.

So wtf does it mean for investors?

First, what we do know…

Buying power… One thing we do know is that if you’re a buyer working with an agent, you will be able to negotiate their commission. Spoiler: you should negotiate it down.

Fatter pockets… When you’re selling a property, you’ll no longer be expected to pay the buyer’s agent’s commission.

Pretty much everything else (like how it will impact specific markets) is pretty unclear. But that doesn’t mean we can’t speculate…

Fewer buyers… The added out-of-pocket cost (read: buyer’s agent’s fees) could mean fewer buyers are able to afford properties. That could be good if you have the capital to pounce when others can’t.

Of course, if there are fewer buyers… Econ 101 tells us that less demand means lower prices. So, if appreciation is your main KPI, it might be bad news bears.

Putting the broke in broker… If part of your strategy includes being an agent or broker, your model just got flipped on its head. The downward pressure on commissions is going to hurt.

New opportunities… Problems need solutions. There are going to be a lot of problems to solve in this new world, which means there might be business opportunities for those of you willing to think outside the box. Like, say commission sharing websites.

💭 Mr. Pocket Listing says… Brain hurt? Mine too.

Listen, anyone who tells you they know what’s going to happen is lying. There are too many factors out of our control.

But I do believe that there could be a once-in-a-lifetime opportunity brewing this fall when the Fed cuts rates (and mortgage rates presumably drop) and the real estate market is trying to wrap its head around these new rules.

WHAT ELSE?

More industry headlines I’m keeping an eye on…

• Home prices reach record high as affordability crisis worsens (Read)

• Respondents show cautious optimism about the Q3 housing market (Read)

• Pending home sales post surprise jump in June due to rising number of home listings (Read)

• Surprise, housing cost to income ratio has barely changed (Read)

• 86% of renters say they can’t afford to buy a home, majority says they will never afford one: Survey (Read)

• Defining a buyer’s market ‘is always a bit tricky,’ real estate expert says: 4 signs to monitor (Read)

• Is There a Housing Bubble? Climate Change and the Property Markets (Read)

• The fight to make landlords turn down the thermostat (Read)

DIY

Let’s get tactical…

• My First Big-Time Deal Failed. Here’s Why I’m Happy About It. (Read)

• The States With the Highest Number of Assumable Mortgages—and How To Get One (Read)

• Home Insurance Rates Set to Increase Another 6% This Year. Here’s What Investors Should Know. (Read)

• I’m a Real Estate Agent: 3 Basement Renovations That Will Add To Your Home’s Value (Read)

• Some renters may be ‘mortgage-ready’ and not know it. Here’s how to tell (Read)

• Best way to handle tenants who nitpick everything (Read)

• I’m a New VRBO Owner — Here’s What I Wish I Knew Before I Purchased (Read)

• What is your process for selecting an area/property, especially if it's in another city & you don't know much about it? (Read)

Mr. Pocket Listing’s favorite property of the week (a guy can dream, can’t he?)…

PROPERTY TOUR

It’s time to get a pulse on markets around the country…

(1) 12 Cities You’ll Regret You Didn’t Invest In 10 Years From Now (Read)

(2) The Places Where It Paid Most to Sell Your Home This Spring (Read)

(3) Top 10 U.S. Housing Markets with Highest Priced Homes in Q2 2024 (Read)

(4) Here’s the Current State of the Housing Market in Every State (Read)

SURVEYING

Here’s today’s question…

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One last thing…