Inside Lending Newsletter

QUOTE OF THE WEEK... "For the resolute and determined there is time and opportunity." --Ralph Waldo Emerson, American essayist, lecturer, and poet
INFO THAT HITS US WHERE WE LIVE... No one has been more resolute and determined than those working in the housing market and, yes, more opportunities are arising. Last Tuesday new single-family home sales were reported up 2.1% in May, to a better than expected 476,000 annual rate and up 29% versus a year ago. There were 4,000 more units in inventory, so the months' supply edged up to 4.1, despite the faster sales pace. But that's well below the 5.7-month average of the last 20 years and near the 4-month average of the 1998-2004 housing boom. So as sales grow, builders do have room to increase inventories.

The median sales price of new homes, at $263,900, is up 10.3% versus a year ago, while the average price of $307,800 is up 9.6% for the year. And prices are up for all kinds of sales. The FHFA index of prices for homes financed with conforming mortgages is up 7.4% in the last year. The Case-Shiller index of home prices in the 20 largest metro areas is up 12.1% from a year ago. Both indexes have been up for 15 months in a row. Thursday, Pending Home Sales (contracts signed) hit their highest level in six years, up 6.7% in May and up 12.1% versus a year ago. This forward-looking indicator points to solid gains for existing home sales in the months ahead.
BUSINESS TIP OF THE WEEK... As you attempt to develop new ideas, avoid relying on what worked in the past. Instead, focus like Steve Jobs on understanding customers' unmet needs, then figure out how to meet them.

Review of Last Week

BAD NEWS BRINGS GOOD NEWS... The bad news came when the final estimate for Q1 GDP calculated economic growth at a super slow 1.8% annual rate. That was well below the prior 2.4% growth estimate, which forecasters thought would hold. But the bad news was good news to investors, who felt that evidence of a weaker economy would keep the Fed from tapering its bond buying program, which has helped boost stocks as well as the recovery. After 5 volatile days, the major stock indexes closed up for the week. Traders seeking more comfort from bad news got it Friday when the Chicago PMI showed Midwest manufacturing weaker than expected in June.

But wait! There was a slew of economic reports that surprised to the upside. May Durable Goods Orders and Personal Income, and June Consumer Confidence and Michigan Consumer Sentiment all outpaced estimates. The housing recovery, which has been stronger than the overall economic recovery, continues to build. New Home Sales, Pending Home Sales, and the Case-Shiller 20-city Index of home prices all beat expectations. Even weekly Initial Unemployment Claims dipped by 9,000, to 346,000, with Continuing Claims still comfortably under 3 million.

The week ended with the Dow up 0.7%, to 14910; the S&P 500 up 0.9%, to 1606; and the Nasdaq up 1.4%, to 3403.
The big dip in Q1 GDP helped bond prices, as Treasuries scored only their second weekly gain in two months. The FNMA 3.5% bond we watch ended the week up 1.02, at $101.14. National average mortgage rates posted their largest weekly gain in 26 years, according to Freddie Mac's Primary Mortgage Market Survey for the week ending June 27. Remember, mortgage rates can be extremely volatile, so check with your mortgage professional for up to the minute information. But rates are still attractive. The Mortgage Bankers Association had purchase loan demand up 3% for the week, and up 16% over a year ago.

DID YOU KNOW?... The new Mortgage Credit Availability Index from the Mortgage Bankers Association and an independent information provider gauges whether mortgage credit is more or less available month to month. It rose in May.

This Week’s Forecast

MANUFACTURING AND SERVICES UP, JOBS SLOW, UNEMPLOYMENT HOLDS... Today, the June ISM Index will tell us how the manufacturing sector of the economy is faring and economists expect a reading just into expansion territory. Wednesday's ISM Services should show that sector, already expanding, up again in June. The big news will be Friday's June Employment Report. Job growth is forecast to continue at a slow pace, with 165,000 new Nonfarm Payrolls added during the month. Analysts do not expect the Unemployment Rate to drop from 7.6%.

Thursday July 4, financial markets will be closed in observance of Independence Day.

The Week’s Economic Indicator Calendar

Weaker than expected economic data tends to send bond prices up and interest rates down, while positive data points to lower bond prices and rising loan rates.

6 Steps to Making an Effective Elevator Pitch

An "elevator pitch" is a quick but compelling description of what you do and the unique value you offer. This pitch could be delivered to a captive listener in the time it takes an elevator to get to the lobby. Selling yourself succinctly also can come in handy at restaurants, business receptions, and industry gatherings.

But if you're like most professionals, you probably haven't taken the time to sit down and compose your elevator pitch. When these opportunities come along, most people just wing it. OK, you know what you do and why people hire you. But go deliver this off-the-cuff pitch to a friend and see how you do. Chances are, you'll stumble. That's normal. Unless your business is marketing, marketing yourself doesn't come naturally.

Here's how to put together a simple but effective elevator pitch you can deliver with ease.

1. Remember, attention spans are very short. 
The overall goal in composing an elevator pitch is to make your points in quick sound bites. Imagine you're on TV. If you need to, you can always add a point or two later.

2. Begin with one sentence that says who you are. For example, "I'm a CPA who specializes in small businesses." Or "I'm a real estate agent covering the greater Springfield area." 

3. In the next sentence, summarize what you do in two or three key points.
This could be something like, "I take care of everything for an organization from keeping the books and preparing tax returns to improving their cash flow."

4. Rehearse those two sentences.
The two sentences you've just composed constitute your opener. Practice them until they sound spontaneous and natural.

5. Articulate your unique, compelling story.
If the person you're talking to seems interested or, even better, asks you to elaborate, you now can go into what makes you stand out from the competition. If you can, put these points into a little narrative, like: "I set up a separate site for each client that shows everything we're working on. This speeds our work together and lets clients take advantage of new opportunities faster, so they can jump ahead of their competition." Don't forget to marry features of your work with client benefits.
6. Open the door at the close.
Before you each go your separate ways, be sure to close, but leave the door open. Pull out a fresh business card from your wallet and say something like, "Hey, it was great to meet you. Listen, here's my card, I'd like to stay in touch." If it feels appropriate, try something like, "Would you mind if I followed up with you in the next few weeks. I'd like to find out more about what you do, maybe over coffee or breakfast."

The goal of an elevator pitch is to start a relationship, the foundation of most business transactions. You might do business together, or refer business to each other. Don't get discouraged. If the other person doesn't give you her card, just look up her contact info online. Then email an article or blog post that might be helpful, as a way to follow up. If you don't get an immediate response, be patient. Let some time pass before you ping her again.

Take these steps and you'll fine tune an elevator pitch that will widen your network of prospects and partners. Why not take a few minutes now and start jotting down ideas. Here's to your success pitching your business in elevators and everywhere else, as you keep putting together your best year ever.... Enjoy a great month!