December 2022 CAI-NJ

PREDICTIONS... from page 38.

current mortgage rates on the rise at 6.43 – 7.2%, there will likely be an increase in foreclosures, as well as an increase in delinquencies for community associations in 2023. Inflation has affected a wide range of goods such as apparel, travel, food, new and used vehicles, and ener gy prices. Having to spend more on day-to-day necessities leaves homeowners in a more strenuous position to make their mortgage payments. Increased mortgage rates mean increased monthly mortgage payments, which negatively impacts homeowners. This increase can place financial stress on the homeowner and lead to default. Typically, when homeowners have difficulty paying their mortgage, they also have difficulty paying their association dues, resulting in an increase in delinquencies for community associations. I predict this trend of rate increases and delinquencies will continue; therefore, it will be prudent for managers and boards to stay on top of delinquencies. David Velasco, Assistant Vice President — JGS Insurance a Baldwin Risk Partner (Insurance) The Council of Insurance Agents and Brokers recently released its latest market data showing that we are now in the

tinue having upfront conversations with customers holding strategic pre-construction meetings with clients, engineers, and suppliers to minimize rising material costs, and determine material availability and pricing, accurate schedules, and realistic project timelines. For example, we recently completed a $2.6 Million roof ing project. Prior to the COVID-19 pandemic, there would have been monthly payment requisitions for completed work and no serious concern about fluctuations in material and labor costs. However, for this post-Covid job, the client paid an $875,000 deposit for all material purchasing to essentially “lock in” material costs and avoid mid-job price increases. The client saved more than $230,000 with this proactive plan. As prices continue to rise, using strategies like this to manage volatile price trends will be vital. Melissa Volet, Esq. — Shareholder at Stark & Stark Attorneys at Law (Law) With inflation at 8.2% as of September 2022, and

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