American Pacific Mortgage

American Pacific Mortgage

Wednesday, March 9, 2022

First COVID, Now A War in Ukraine?


When clients ask me where rates are heading (nearly every day), I always point out that since we have an international economy today, events around the world can and do affect interest rates here in the US.   Case in point, the markets are currently experiencing dramatic volatility and rates have dropped a bit after a rapid climb in the first Q this year.  How long will it last?  No one can guarantee they will remain on a downward trend, as they have been up and down over the last week.  The bottom line is we can only move forward knowing that eventually rates will continue to rise.  There is nothing like the thrill of receiving three or more reprice notifications during one day!  Up by .25%, down .375%. Yikes!!

The war is having effects in multiple areas including interest rates;  the stock market;  oil prices (as we all can see at the gas pump) and on many other consumer products, as the supply chain is further impacted.   At this juncture no one can predict how long this will last. Only that the poor citizens of Ukraine are feeling much worse pain.


Home prices across the country rose last year by an astounding 19%.  In both Los Angeles and Orange Counties, the median home price was $950,000 for the month of January.  Crazy!  Most homeowners have a tremendous amount of equity to play with, whether to pull out cash for upgrades or remodeling, adding a new pool, or to buy another home.  The problem is the short supply of new housing.  I looked at a few Open Houses the past weekend.  It was so nice to actually go to an Open House!   One property was a total teardown with incredible ocean views in the hills of San Clemente, listed at only $1.45 million.  WOW.  We figured it would take at least a $2 million budget to get it to a livable condition.

The lack of inventory is a major contributor to rising home prices.  Our inventory in Southern California is at an all-time low.  That is right, I said an ALL-TIME low.  In some areas condo values rose more quickly than did values of single-family residences, which is an anomaly. This is likely due to higher demand at the lower price levels pushing up those values.


HUD came out with Reverse Loans for purchase with the HECM program in 2009.  I closed a home purchase in March of 2009 with a Reverse loan, for what may have been the first in California.


Steve and I began golfing almost every weekend during COVID as one of the few activities we could safely participate in.  While I still don’t have a handicap, I want to report that during our recent golf scramble with 15 couples from our yacht club, we used several of my drives, fairway shots and putts.  YESSSS!

Speaking of the yacht club, things are beginning to return to normalcy with a Mardi Gras bash, weekend brunches and even prime rib night.  Next up:  A weekend cruise to Newport to visit with other yacht clubs.   Steve enjoys crewing on a couple of different boats for the racing events which happen most weekends.  Then we have the Newport to Ensenada race, otherwise known as N2E in April.  I will go down on a tour bus and meet the racers when they get in.  You never know how long the race will take as it all depends on the wind conditions.

Please remember, Life is Good!  And don’t hesitate to call us with any questions you may have.