KPA Wealth Weekly: Trump's First Trade Deal and Future Inflation

Welcome to KPA Wealth Weekly, your source for the latest in financial and mortgage markets. Our goal is for each week, to share economic updates, rate trends, and tips to build a strong financial foundation. (Sorry for lack of posting these last few weeks, the trade war has destabilized this blog)

Let’s dive into this week’s highlights!

• Mortgage Interest Rates

• Stock Market Update and Economy

• Financial Numbers This Week

• Real Estate Market Update: Signs of Life for Buyers?

• This Week’s Wealth Strategy

Mortgage Interest Rates

Stock Market Update and Trends

The market is 30 points away from all time highs. To me, this is pretty clearly not just a dead cat bounce. Buy the dip and hold. If it dips again, buy the dip again and hold. There will likely be waves of inflation for long term in our economy, and there is no safer place than stocks, real estate, and gold. A rotational investing plan where you pick the cheapest of the three and invest constantly is probably the best plan out there.

Key News this Week: Trump announced that China has given us a deal with them where they have agreed to open up China completely to the United States. If true, this is big. If false or they back out of the agreement, we could see some market turbulence.

Trump also had his first face-to-face meeting with Jerome Powell since 2019, where Trump reiterated that rates are too high and Powell replied that he didn’t discuss his expectations for monetary policy. So…. No comment? My Prediction: The federal government has a boatload of debt that needs to refinance. One of two things will happen. Powell will lower rates, or Trump will have to increase consumer taxes either through actually moving forward with the tariffs or actually raising taxes. If these don’t happen then the CIA makes an insane market pain event happen that hurts everyone and causes rates to decrease on the marketplace. Just a joke… Not really…

Notable Earnings This Week:

This week’s earnings reports presented a mix of outcomes across various industries. Here's a quick summary:

Nvidia (NVDA):
Reported Q1 2025 revenue of $44.06 billion, a 69% increase year-over-year, surpassing Wall Street’s estimate of $43.32 billion. The data center segment earned $39.1 billion, a 73% increase year-over-year. Despite an anticipated $8 billion revenue hit in Q2 due to U.S. export restrictions affecting sales of H20 chips to China, investor sentiment remained positive, with the stock rising over 5% in after-hours trading.

Salesforce (CRM):
Reported strong earnings and an optimistic outlook. However, shares slipped 3.3% after a downgrade from RBC Capital.

HP Inc. (HPQ):
Shares fell 8.3% after the company lowered its fiscal-year earnings guidance due to economic headwinds.

Dell Technologies (DELL):
Reported strong Q1 FY2026 results, driven by unprecedented demand for AI servers, generating $12.1 billion in orders and pushing its revenue up 5% to $23.38 billion. However, earnings per share fell slightly below estimates.

Costco Wholesale (COST):
Fiscal Q3 results slightly surpassed analyst expectations with $63.21 billion in revenue and 5.7% growth in comparable store sales, aided by strategies to mitigate tariff impacts.

Ulta Beauty (ULTA):
Shares soared 15% on impressive earnings and enhanced guidance.

Zscaler (ZS):
Surged to a record high on strong results.

MongoDB (MDB):
Reported earnings this week; however, specific details on their performance were not highlighted in the available sources.

Financial News This and Last Week

Here’s a concise summary of this week’s financial news:

Labor Market

Employment Growth:
The U.S. economy added 177,000 jobs in April 2025, exceeding expectations of approximately 135,000. The unemployment rate remained steady at 4.2%.

Sector Highlights:

• Healthcare and Social Assistance: Led job gains with 58,200 new positions, reflecting continued strength in the sector.

• Federal Government: Experienced a decline in employment, attributed to budget constraints and policy shifts.

Manufacturing

ISM Manufacturing PMI:
The ISM Manufacturing PMI for April 2025 fell to 48.7, indicating a contraction in manufacturing activity. This decline is attributed to rising input costs and uncertainties stemming from recent tariff implementations.

Core Business Goods Orders:
Non-defense capital goods orders excluding aircraft, a proxy for business spending plans, tumbled 1.3% in April, the largest drop since October 2024. This decline suggests potential softness in new orders and production levels.

Monetary Policy

The Federal Reserve maintained its current interest rate stance, keeping the benchmark rate within the target range of 4.25% to 4.5%. Officials cited a solid labor market and inflation levels still above the 2% target as reasons for this decision.

St. Louis Fed President Alberto Musalem highlighted the need for a cautious approach to monetary policy, considering the potential impacts of ongoing trade tensions and market volatility.

Additionally, Federal Reserve Bank of Dallas President Lorie Logan stated that the Federal Reserve may need to maintain current short-term interest rates for an extended period as it evaluates the economic impacts of recent trade, tax, and regulatory policies.

This week's developments underscore the interconnectedness of labor markets, manufacturing activity, trade policies, and monetary decisions in shaping the economic landscape.

Real Estate: Buy or Sell? Answer: BUY

📉 Home Sales Dynamics:

• Existing-Home Sales:
  In April 2025, existing-home sales declined by 0.5% month-over-month to a seasonally adjusted annual rate of 4.00 million units, marking a 2.0% decrease from April 2024.

• New Home Sales:
  Sales of new single-family homes surged to a seasonally adjusted annual rate of 743,000 in April 2025, a 10.9% increase from March and 3.3% above April 2024 levels.

🏡 Inventory and Listings:

• National Inventory:
  As of April 2025, the inventory of unsold existing homes rose to 1.45 million units, up 9.0% from March and 20.8% from April 2024, representing a 4.4-month supply at the current sales pace.

• Seller-Buyer Dynamics:
  For the first time since 2013, home sellers outnumber buyers, with nearly 500,000 more homes listed than there are buyers. This shift is attributed to elevated mortgage rates near 7% and broader economic concerns deterring potential buyers.

📈 Pricing Trends:

• Median Existing-Home Price:
  The median existing-home price reached $414,000 in April 2025, up 1.8% from April 2024, marking the 22nd consecutive month of year-over-year price increases.

• Median New Home Price:
  The median sales price of new houses sold in April 2025 was $407,200, a 0.8% increase from March but a 2.0% decrease from April 2024.

💡 Market Outlook:

• Mortgage Rates:
  As of May 29, 2025, the average 30-year fixed mortgage rate was 6.89%, slightly up from the previous week.

• Buyer Sentiment:
  Despite increased inventory, high mortgage rates and prices continue to deter buyers. However, the market shift towards more sellers than buyers may lead to more favorable conditions for buyers in the near future.

🏆 Bottom Line:

The real estate market from May 20 to May 30, 2025, indicates a gradual shift towards more favorable conditions for buyers. While high mortgage rates and affordability concerns persist, increased inventory and moderated price growth provide potential opportunities for well-prepared buyers. Strategic planning and staying informed about local market trends are essential for navigating this evolving landscape.

The best strategy for a homebuyer exists right now, negotiate a seller credit to get your interest rate from the 6’s down to the 5’s and maybe even have the seller pay your closing costs.

This Week’s Wealth Strategy

Tired of the same old financial advice? Below is a unique, non-mainstream wealth-building strategy tailored for entrepreneurs, realtors, and real estate investors. Each strategy is actionable and designed for meaningful returns or long-term wealth. We break down how to implement them step-by-step, who they’re best for, what you need to get started, and the potential payoff. These aren’t your typical stock-and-bond tips – they’re fresh ideas you won’t hear from traditional finance gurus.

Strategy: “Title Arbitrage” – Leverage Distressed Property Titles for Fast Capital & Equity

Overview:

There’s an overlooked pocket of wealth hiding in title issues — properties that can’t be sold or financed due to legal encumbrances, clouded ownership, or inheritance disputes. These “zombie properties” are often ignored by traditional investors but present major upside for those willing to roll up their sleeves.

By working with real estate attorneys and wholesalers, you can identify these distressed-title properties, resolve the issues, and either (1) flip them for cash, (2) wholesale to investors, or (3) negotiate equity positions with owners in exchange for cleaning up the title.

Think of it as legal rehab instead of physical rehab.

How to Implement (Step-by-Step):

1. Source Problem Properties

   • Use title company contacts, probate attorneys, or foreclosure filings.

   • Join investor meetups and local Facebook groups – many wholesalers pass on these leads due to complexity.

2. Partner with a Real Estate Attorney

   • Find a title-savvy lawyer who understands quiet title actions, probate, partition lawsuits, etc.

   • Negotiate a fixed fee or deferred payment plan tied to closing.

3. Create the Win-Win Deal

   • Offer homeowners (or heirs) a deal: “You can’t sell this now, but I’ll cover legal fees and handle the fix. In return, I get 50% of the net proceeds.”

4. Fix the Title

   • File necessary court documents (probate, quitclaim deeds, heir affidavits).

   • Use your attorney to walk the deal through to marketable title.

5. Exit Strategically

   • Flip it, list it, or wholesale to an investor – you’re now a problem-solver, not just a buyer.

👥 Who It’s Best Suited For:

• Realtors/investors with title company relationships.

• Wholesalers looking to move into a higher-margin niche.

• Entrepreneurs with patience and grit for paperwork and negotiation.

Startup Costs & Required Skills:

• Startup Capital: $2,000–$5,000 per deal (attorney fees, title insurance, filing costs).

• Skills Needed: Problem-solving, basic legal understanding (or access to it), negotiation, patience.

Potential Returns & Outcomes:

• Profit Potential: $20,000–$100,000+ per resolved title depending on the property.

• Leverage: Control real estate without cash offers – your value is in the solution, not your wallet.

• Deal Flow: You can build a steady pipeline by networking with probate attorneys and wholesalers.

Kyle Allgair
CEO of KPA Home Loans
📞 (279) 977-8149 | ✉️ [email protected]
🌐 KPAhomeloans.com

Kyle Allgair is the CEO of KPA Home Loans, with years of experience helping clients build wealth through real estate and strategic financial planning. Contact him for personalized advice on achieving your financial goals.