⚡ The Lending Letter 🏡

Rates Slide Into Your DMs (Down 0.03% Today!) 📉

Happy Thursday! ☕ We're officially halfway through January, which means two things: (1) your New Year's resolutions are either going strong or have been abandoned for pizza, and (2) we're getting some interesting movement in mortgage rates. Today's got some news worth paying attention to. Let's dive in. 🏊‍♂️

🎯 Mid-January Rate Check: We're Dipping Lower!

Okay, real talk: seeing rates tick down—even by a small amount—feels good right now. We're at 6.04% today, down from 6.07% yesterday. That's not earth-shattering, but it's movement in the right direction. 🎉

What's driving this? The bond market is reacting to a mix of inflation data and economic indicators that suggest things are cooling off just enough to keep the Fed from getting too aggressive. Translation: lenders are getting slightly less nervous, which means they're willing to shave a few basis points off rates. It's like when your friend finally agrees to split the appetizer after saying they "weren't hungry"—small wins matter. 🍟

Here's the thing about January: it's historically a slower month for real estate, which means less competition for buyers and more room for negotiation. Combine that with rates that are trending down (even gradually), and you've got conditions that are quietly favorable if you know how to play them. 🎮

💰 Lender Promos: January Lending Opportunities

🧠 Education Corner: Lock Period Strategy (And Why It Matters Right Now)

Let's talk about something most people completely overlook: rate lock periods and how to strategically use them to your advantage. This is especially relevant when rates are bouncing around like they have been. 🎢

Here's what you need to know: When you lock a rate, you're locking it for a specific period—usually 30, 45, or 60 days. The longer the lock period, the slightly higher the rate (lenders charge for that extended guarantee). But here's where it gets interesting...

🏘️ For the Real Estate Investors: The 1031 Exchange Deadline Reality Check

Okay investors, let's talk about something that stresses people out way more than it should: 1031 exchange timelines. If you sold a property in late 2025, your clock is ticking. Here's your refresher: 📅

The 45-Day Rule
You have 45 days from the sale of your relinquished property to identify potential replacement properties. This isn't flexible—the IRS doesn't care about weekends, holidays, or the fact that you were in Cabo. According to IRS Publication 544, if you miss this deadline by even one day, your 1031 falls apart and you owe capital gains taxes. Ouch. 💸

The 180-Day Rule
You have 180 days to actually close on the replacement property. Again, hard deadline. The catch? The 180 days runs concurrently with the 45 days, not after. So if you take all 45 days to identify, you only have 135 days left to close. Time management matters here. ⏰

The January Advantage
Here's why buying in January for a 1031 makes sense: less competition means easier negotiations, and motivated sellers are more likely to accommodate your timeline needs. Plus, if you're using financing for your replacement property, lenders are generally less busy right now, which means faster processing. Every day counts in a 1031, so faster = better. 🚀

Smart 1031 Moves Right Now:

• Upgrade Your Property Quality: With slightly better inventory available, use this exchange to move from a B-class property to an A-class property. Same money, better tenants, less headaches.
• Geographic Diversification: Selling in an expensive coastal market? 1031 into multiple properties in emerging markets. Your $800k California duplex becomes four cash-flowing units in Texas or Florida. 🗺️
• STR Opportunity: Traditional rental → STR property can be a great 1031 strategy. The income potential is often higher, and if you're strategic about location, you can build serious equity while deferring all that capital gains tax.

🎓 Personal Finance Power Move: The Backdoor Roth Conversion Strategy

📊 Market Reality: What's Really Happening in Mid-January 2026

Let's cut through the noise with some real talk about what the housing market looks like right now:

Inventory is Still Tight, But Improving
We're not swimming in options, but there's definitely more inventory than this time last year. According to recent Realtor.com data, active listings are up in most markets. For buyers, this means slightly more negotiating leverage—especially on properties that have been sitting for 30+ days. 📊

Price Growth Has Stabilized
We're seeing healthy, sustainable appreciation in most markets—around 3-4% annually. This is way better than the crazy double-digit growth that wasn't sustainable anyway. Zillow's latest market data shows this trend holding across most major metros. 🏘️

The January Effect is Real
Transaction volume drops every January as casual buyers and sellers wait for spring. But serious players stay active, and that creates opportunity. Properties that would have 10 offers in April might have 2-3 in January. That difference matters when you're negotiating. 🎯

Affordability Has Actually Improved Slightly
With rates ticking down (even gradually) and price growth moderating, monthly payments are becoming slightly more manageable. According to ATTOM Data Solutions, the income-to-housing-cost ratio is improving in many markets. It's still tough out there, but the trend is moving in the right direction. 💪

🎯 The "Wait for Lower Rates" Fallacy

Everyone wants to know: should I wait for rates to drop more? Here's the honest answer:

Rates at 6.04% aren't historically high—they're historically normal. The 3% rates of 2020-2021 were the aberration, not the norm. According to Freddie Mac historical data, the average 30-year fixed rate since 1971 is around 7.75%. So 6.04%? That's actually below the long-term average. 📉

But here's the more important point: waiting for "perfect" conditions is how opportunities get missed. While you wait for rates to drop to 5.5%, home prices might climb 5%. Your monthly payment ends up roughly the same, but now you've missed months of building equity, depreciation benefits, and potential appreciation. ⏰

The smart play? Buy when you find the right property at the right price, then refinance if rates drop significantly. That flexibility is the best of both worlds. And remember—you can always refinance your rate, but you can't refinance your purchase price. 🏡

🌟 The Bottom Line

Rates dropping to 6.04% isn't going to make headlines, but it's meaningful movement. And in a market where every basis point matters, we'll take the wins where we can get them. 🎉

January is genuinely one of the most underrated months for real estate activity. While everyone else is focused on gym memberships and dry January, smart investors and buyers are locking in deals with less competition and better terms. The spring buyers will show up in a few months and wonder why inventory is tighter and prices are higher. Don't be that person. 🤷

Whether you're buying a primary residence, adding to your investment portfolio, or building an STR empire, the fundamentals haven't changed: real estate remains one of the most reliable wealth-building tools available. Rates around 6% are manageable, the tax benefits are still incredible, and the long-term wealth creation potential is undeniable. 💎

Stay informed, stay strategic, and remember: the best time to take action is when you have clarity and opportunity. Right now, we have both. ✨