Mike’s Monthly Mortgage and Real Estate Update – February 2026

Happy February!

Wow… that was a fast month. January may officially be the fastest month of the year so far. I'm still shocked at how quickly it went!

As always, I wanted to share a quick market update with you. And yes, please be on the lookout for my Christmas / New Year's / Holiday / Valentine's Day / Easter card. All joking aside, I am being told it will go out soon! It’s a delay due to Covid, tariffs, or something else!

What's Happening in the Real Estate Market

We've seen a busy start to the spring buying season, and it actually kicked off around mid-January. We've already opened a lot of new purchase escrows, which is exciting to see.

Property values remain very house-specific. It's tough to say exactly where prices will go this year, but one thing is clear:

• Homes that are well-maintained and in great condition are still selling at a premium.
• There is more inventory to choose from, but not an overwhelming amount.

A quick real-life example:

I had clients in escrow in January who were negotiating repairs. We couldn’t come to terms, and shortly after, a very similar home in better condition came on the market for $20,000 more. My clients jumped on it immediately.

That original home will now go back on the market. This really shows there’s a fine line between what sellers can ask for and what buyers are willing to accept. Overpriced listings are still out there, and like last year, those tend to sit.

A Note on Condos & HOA Fees

We're seeing HOA fees increase across many condo complexes, and there are a couple of big reasons for this:

• SB 326, which requires balcony inspections and retrofits
• Rising Insurance costs in California

Some complexes are behind on required retrofits, which can make condos non-warrantable. When that happens:

• Interest rates are higher
• A minimum of 10% down is usually required

In other cases, HOAs are underinsured or have very high deductibles, which can also cause financing issues. These factors are driving HOA dues higher and impacting affordability, so it’s something buyers and sellers should absolutely be aware of.

Interest Rates & the Economy

Rates have come down slightly, but the waters are still choppy. We've been in roughly the same range since late September, without a true breakout to the lower side.

There’s a lot of talk around the new Fed Chairman nominee, but realistically, I don’t expect immediate rate cuts. And truth be told, rates don’t always move because of the Fed; sometimes they move despite them.

Inflation is low.

Unemployment is flat.

Economic growth is also flat.

Yet ongoing global and political uncertainty has kept rates artificially higher than many expected. My honest take? We may not see major movement for a while, as the markets do not like uncertainty!

Creative Financing & Free Refinances

We’ve seen more homeowners choosing to add on to their homes, using second mortgages or home equity lines of credit at reasonable rates.

We're also offering FREE refinances on loans above $420,000, and we'll do this multiple times.

For example:

• If you're at 6.625% and we can move you to 6.125% for free, I say do it now. (700K loan amount with a 780 credit score at 75% LTV)
• If rates improve again in 6 months, we’ll need a few updated items, and we'll refinance you again, for free.

I'm not a big fan of paying fees or buying down rates in this market, but I am a big fan of saving money when you can.

Interest rates are bouncing every day, and it is hard to see them going dramatically lower unless something fails in the economy, or we get the 2% inflation the government wants. So taking a little savings when you can is a good thing!

Final Thoughts

Things are more expensive, but if we plan properly and do the right thing when we can, we can save a little money here and there. Buying a house is expensive, but it gets less expensive over time through refinancing. Real estate prices will likely double in the next 10-15 years, and you don’t want to be priced out. I remember my dad saying we would be on easy street when he started making $20,000 per year. $20K annually has come and gone, and easy street never happened for him, but proper budgeting and investments can make a huge difference. Renting is great if I am your landlord, but otherwise, ownership is the way to go, even if it seems tough! I say that, and most of you are my past clients, so I am preaching to the choir!

Please let me know if you need anything and I hope to hear from you soon!