Dog ownership comes with many responsibilities, and keeping your dog clean is one of the most challenging. Some owners tackle the bathing, brushing and trimming themselves, while others pay for a dog grooming service. If you’re one to leave it to the professionals, you may have wondered if you’re supposed to add a gratuity after receiving the bill.
Start with the average cost of dog grooming
Tips are often calculated by taking a percentage of the total bill. A basic grooming service can cost $50 to $75, according to Erin Myers, a grooming expert and project analyst at the American Kennel Club.
According to etiquette experts, the industry standard for tipping service professionals is 15% to 20% of the bill, so for dog groomers that would work out to $7.50 to $15. If you’re unsure, use our tip calculator.
Factors that could affect the size of your bill or tip
While calculating a percentage of the total bill is a good place to begin, there are some other things that may influence your tip.
Dog breed and size: Some breeds require a little extra maintenance, especially if they’re prone to matted fur or shedding (think poodles and bichon frisés). If your dog needs lots of brushing or a special haircut, you might want to consider that in your tip. Bigger dogs also can take longer to groom.
Temperament: If your dog hates getting groomed and is difficult to manage, it might make the appointment last longer and, potentially, endanger the groomer. Consider tipping more if this sounds like your dog.
Salon address: Location influences the prices of most things, including grooming. People going to a shop in an urban area should anticipate a larger bill and expect to pay more in tips than those in suburban or rural areas.
Mobile vs. brick and mortar: A mobile grooming service can be a convenient option for owners who find it difficult to bring their dog to a salon. However, Myers says “people should anticipate that [mobile grooming] is going to be a little bit more expensive” to cover vehicle gas and maintenance, permits, specialized equipment and the fact that mobile groomers can typically care for only one dog at a time. When calculating how much to tip a mobile groomer, take these factors into consideration.
Quality of service: The salon’s cleanliness, groomer’s communication style and your dog’s final appearance will likely influence how much you tip. Myers suggests assessing your dog after a groom to make sure that there are no tangles, cuts or other issues because they could be red flags for subpar work. If you feel like you received poor service, you might tip less than 15% or nothing.
Number of groomers: Some groomers do everything from start to finish while other salons have groomers dedicated to different parts of the process. If there is a division of labor, you might want to spread out the tip.
How to reduce your dog grooming bill
The cost of grooming should be top of mind before you adopt or purchase a dog. If the breed you want needs regular grooming, include those recurring expenses in your budget. Many people consider pets to be family members, which means veterinarian and grooming expenses might fall under the “50% for needs” category within the 50/30/20 budget framework.
Here are some other ideas to help cut costs:
Get a shorter cut to go longer between grooms. This extended timeline can save you money in the long run.
Join a loyalty program and take advantage of seasonal promotions. Some groomers might offer discounts after completing a number of visits or feature holiday specials.
Keep up with at-home grooming between services. Taking over more manageable aspects of your dog’s care, like ear cleaning or toenail clipping, can make your groomer’s job quicker, potentially leading to lower costs.
Switch to a national chain. If you’ve been going to a mom-and-pop groomer, you could save money by taking your dog to a national chain where tipping isn’t expected, according to Myers.
Check to see if your pet insurance offers a wellness plan. Some providers let you add on certain grooming services.
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Should you tip a dog groomer?
A grooming appointment can last two to four hours, according to PetSmart, a national pet retail chain. The average appointment includes brushing, ear cleaning, toenail clipping, bathing, drying and styling. Groomers may be grappling with scared or grumpy dogs who make the job more challenging. If your groomer delivers consistent results and is kind to your dog, tipping is a way to show your appreciation
What if you can’t afford to tip?
If a 15% to 20% tip isn’t feasible, tipping a smaller amount might be an option. You could also reserve your tip for the holiday season, which can be a time to thank the service providers who make your life easier throughout the year. Adding a line in your holiday budget for your groomer will give you time to plan and save for the extra cost.
Myers suggests having an open conversation with your groomer about tipping when you drop off your dog. Asking for the costs upfront and establishing whether a tip is expected can help build an honest relationship.
If a tip isn’t in your budget, there are other ways to show your appreciation. Posting a positive review online could help boost business, and praising your groomer directly to their manager is a kind gesture.
Welcome to Summerlin, the epitome of tranquility and luxury living in the heart of Las Vegas.
With its meticulously designed neighborhoods and vast array of exclusive amenities, Summerlin truly embodies the perfect blend of opulence and serenity.
From exquisite gated communities to world-class golf courses and award-winning schools, every aspect of life in Summerlin is centered around providing the utmost comfort and convenience.
And people have started to take notice.
Summerlin has seen an influx of new residents in the past few years, fast becoming Nevada’s top-selling community.
In the first half of 2023 alone, an impressive total of 544 new homes were sold in the master-planned community, pushing it to rank #5 nationally in new home sales in a recent midyear report by national real estate consultant RCLCO.
Celebrities too have been flocking to the area, with A-listers like Mark Wahlberg ditching the glamorous L.A. lifestyle and buying homes in Summerlin, Nevada.
To get a better feel of the local real estate market, we’ve reached out to industry expert Cami Lincowski, a prominent luxury Las Vegas real estate agent and former star of HGTV’s Say Yes to the Nest.
Talking about the appeal of the area of its rise in popularity, Cami tells us that “Summerlin is not only thriving, but when you throw in the latest and greatest shopping & high-rated restaurants the valley has to offer; there’s no denying that this area ranks amongst the top cities to call home.”
So let’s take a closer look at what makes this Las Vegas Valley community such a great place to live.
The luxury lifestyle in Summerlin
Summerlin is synonymous with luxury.
This master-planned community boasts some of the most prestigious homes in Las Vegas, offering residents an unparalleled level of elegance and sophistication. From sprawling mansions to stylish townhouses, Summerlin has something to suit every taste and preference.
The meticulously designed neighborhoods of Summerlin showcase architectural excellence and attention to detail.
Gated communities like The Ridges, Tournament Hills, The Lakes, and Red Rock Country Club provide residents with a sense of exclusivity and security. Impeccably landscaped streets and manicured lawns add to the overall aesthetic appeal, creating a sense of grandeur at every turn.
More recently, The Summit Club has emerged as the pinnacle of luxury living in Summerlin. The 555-acre resort community south of The Ridges (and only 9 miles away from the Las Vegas strip) is the only fully private residential golf and lifestyle club community in all of Las Vegas.
In addition to the stunning homes, Summerlin offers a wealth of amenities that cater to the luxury lifestyle.
Residents have access to world-class golf courses, private country clubs, and state-of-the-art fitness centers. The community also boasts a wide range of recreational facilities, including tennis courts, swimming pools, and parks, ensuring that there is always something to do for those seeking an active lifestyle.
The real estate market in Summerlin
The real estate market in Summerlin is thriving, thanks to its reputation as one of the most desirable places to live in Las Vegas. But you do have to have deep pockets – or an outstanding credit score – to afford to buy here.
The demand for homes in Summerlin has been steadily increasing over the years, leading to a rise in property values. The community’s prime location, coupled with its exceptional amenities and quality of life, make it an attractive choice for both homebuyers and investors.
But despite being a top luxury home destination, Summerlin’s house prices can accommodate a wide range of budgets — and are considerably less prohibitive compared to those found in other top luxury markets on the West or East Coasts.
“Anyone can call Summerlin home,” luxury agent Cami Lincowski tells us. “With price ranges starting at $400k & tipping the scale at $15m+, this city is not just made of city lights, but all walks of life.”
The community offers a wide range of housing options, from single-family homes to luxury condominiums and townhouses.
Whether you are looking to buy a home or invest in real estate, Summerlin offers a wealth of opportunities. The community’s diverse housing options cater to a range of budgets and lifestyles, ensuring that there is something for everyone.
Celebrities that call it home
With the Mansion Tax adding fuel to the California exodus, many of the Golden State’s affluent residents started flocking to new luxury markets — with A-listers and famous individuals choosing to make Las Vegas their new primary residence.
Naturally, Summerlin emerged as a top choice.
Celebrities to have called Summerlin home include actor Mark Wahlberg (who sold his sprawling $55 million LA mansion to move here), Grammy Award-winning singer Celine Dion, who sold her freshly-built Summit Club house for a record $30 million, and several Golden Knights players.
NHL pro Max Pacioretty played only four seasons with the Vegas Golden Knights (2018-2022) but went all in when it came to making himself at home in Sin City. The Carolina Hurricanes left winger owned a 10,000+ sq. ft. home in The Ridges community, which he sold for top dollar last year.
Pacioretty’s spectacular estate “netted” a cool $11 million, a record for the high-end The Ridges community.
Rob Roy, the CEO, founder, and chairman of Switch Communications Group, also paid $33 million for 5 acres to build a luxury estate in the same Summerlin resort community.
And while Wahlberg recently sold one of his Summerlin homes for $16.6 million one year after buying it, he made it clear he loves living here and has no plans of leaving the Las Vegas community. He’s just waiting for his other mansion to be completed.
Top neighborhoods in Summerlin
Summerlin is home to a number of top-notch neighborhoods, each with its own unique charm and character. Here are some of the most sought-after areas in the community:
#1 The Ridges
Located at the base of the Red Rock Canyon, The Ridges is an exclusive gated community known for its luxurious homes and breathtaking views. With its private golf course and world-class amenities, it is one of the most coveted neighborhoods in Summerlin.
#2 Tournament Hills
Situated around the TPC at Summerlin Golf Course, Tournament Hills offers residents the opportunity to live near one of the best golf courses in Las Vegas. The neighborhood features a mix of custom-built homes and luxury estates, providing a premium living experience.
#3 The Gardens
Nestled among lush green landscapes and scenic walking trails, The Gardens is a peaceful and picturesque neighborhood in Summerlin. With its tree-lined streets and well-maintained parks, it offers residents a serene and idyllic setting.
Tranquility and natural beauty
One of the most remarkable aspects of Summerlin is its breathtaking natural beauty.
Nestled against the majestic Red Rock Canyon, the community offers stunning views of the surrounding desert landscape. The vibrant hues of red and orange against the clear blue sky create a picturesque backdrop that is hard to find elsewhere in Las Vegas.
Summerlin is a nature lover’s paradise, with over 150 parks and more than 150 miles of trails to explore. Whether you enjoy hiking, biking, or simply taking a leisurely stroll, there is a trail for every skill level. The community is also home to numerous lakes and ponds, perfect for fishing or enjoying a peaceful picnic by the water.
For those seeking a more tranquil experience, Summerlin offers an abundance of peaceful retreats. The community’s botanical gardens and meditation centers provide a serene environment for relaxation and introspection. Escape the hustle and bustle of city life and immerse yourself in the tranquility that this community has to offer.
Amenities and recreational activities
Summerlin is not just a place to live; it is a lifestyle.
The community offers an impressive array of amenities and recreational activities that cater to residents of all ages. From world-class golf courses to community centers and sports facilities, there is something for everyone.
Golf enthusiasts will be delighted by the exceptional courses that Summerlin has to offer.
The TPC at Summerlin is a championship golf course designed by renowned architect Bobby Weed. With its challenging fairways and breathtaking views, it is a favorite among golfers of all skill levels. The community is also home to the Red Rock Country Club, which features two Arnold Palmer-designed courses and a host of other amenities.
In addition to golf, Summerlin offers a wide range of recreational activities. The community’s numerous parks and trails provide ample opportunities for outdoor enthusiasts to stay active.
Tennis courts, basketball courts, and soccer fields are available for those who enjoy team sports. And for those who prefer indoor activities, the community’s state-of-the-art fitness centers and swimming pools provide plenty of options.
Schools and education options
Summerlin is not only known for its luxury homes and amenities; it is also home to some of the best schools in Las Vegas. The community offers a wide range of educational options, from top-rated public schools to prestigious private institutions.
The Clark County School District serves the majority of students in Summerlin, offering a comprehensive curriculum and a strong emphasis on academic excellence. The district’s schools consistently rank among the best in the state, providing students with a quality education that prepares them for future success.
For those seeking a private education, Summerlin is home to several esteemed institutions.
The Alexander Dawson School is a renowned independent school that offers a challenging and well-rounded education. The Meadows School, another prestigious private institution, is known for its rigorous academic program and strong college preparatory curriculum.
When it comes to shopping and dining, Summerlin has it all. The community is home to The Shops at Summerlin, a premier shopping destination that offers a wide range of retail and dining options.
From high-end fashion boutiques to popular chain stores, there is something for every shopper.
Food enthusiasts will also be delighted by the diverse culinary scene in Summerlin. The community boasts a wide range of restaurants, offering everything from casual dining to fine dining experiences. Whether you are craving sushi, steak, or Italian cuisine, you will find it all in Summerlin.
Summerlin’s proximity to the Las Vegas Strip
One of the unique aspects of living in Summerlin is its close proximity to the Las Vegas Strip. While the community offers a peaceful and serene environment, the bustling energy of the Strip is just a short drive away.
Residents can easily access all the excitement that Las Vegas has to offer, from world-class entertainment and nightlife to renowned restaurants and shopping.
The convenience of being near the Strip allows residents of Summerlin to enjoy the best of both worlds. They can retreat to the tranquility of their luxurious homes after a night out on the town, providing the perfect balance between opulence and excitement.
Why Summerlin is the ideal place to live in Las Vegas
To sum things up, Summerlin is a community that embodies the perfect blend of luxury and tranquility. Its meticulously designed neighborhoods, breathtaking natural beauty, and array of exclusive amenities make it an ideal place to live in Las Vegas.
Whether you are seeking a luxurious retreat or a place to call home, Summerlin offers a lifestyle unlike any other. From world-class golf courses to award-winning schools and gourmet dining, every aspect of life in Summerlin is centered around providing the utmost comfort and convenience.
Escape the hustle and bustle of the Strip and immerse yourself in the beauty and serenity of Summerlin.
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Last year was tough for potential home buyers: Prices and mortgage rates were high, while the number of homes available was low. But even if rates inch down and inventory climbs — trends many experts expect in 2024 — some nonhomeowners will be content to sit this one out. That’s because renting a home isn’t just a consolation prize, something you do only if you can’t buy. For many, it’s a deliberate choice.
Well over one-third (37%) of renters plan on renting forever, according to NerdWallet’s 2024 Home Buyer Report. For many, it’s a lifestyle choice: Three-quarters of Americans who rent their homes say renting suits their life better than owning right now.
Meanwhile, a smaller share has resigned themselves to renting after a discouraging run as a potential buyer: 1 in 20 Americans who began 2023 with plans to purchase canceled those plans because they changed their mind about buying a home, now or ever, according to the survey.
The decision to rent or buy is complex and goes beyond the financial aspects. Here are four considerations that may make renting not only acceptable but the right choice.
1. Upfront costs of homebuying are substantial
More than half (56%) of renters say they don’t think they’ll ever be able to afford homeownership, according to the NerdWallet survey. Indeed, average mortgage payments are 37% higher than the average rent in multifamily units, according to a recent analysis from CBRE Research, a commercial real estate services and investment firm.
And these monthly ownership costs are far from the only ones tipping the scales. Even in markets where rents and house payments are comparable, buying a house requires upfront costs that far exceed a security deposit. These upfront homebuying costs, including the down payment and closing costs, can easily run into the tens of thousands of dollars.
Saving for these costs can take years of sacrifice, setting aside money that could otherwise go toward retirement or other long-term financial goals — or fun stuff, such as travel. It boils down to what you value, and if your heart isn’t really in it, homeownership might not be worth those sacrifices for the time being.
2. You don’t want to feel tied down
Owning a home makes it more cumbersome to move when you receive a job offer or simply desire a change of scenery.If you’re uncertain of where you want to live long-term, it can be difficult (and costly) to commit to a mortgage. The 75% of renters who say renting suits their lifestyle better than owning would likely nod their heads to this.
There’s no hard-and-fast rule regarding the age at which you should “put down roots.” There’s really no rule at all. If you prefer the flexibility of shorter-term commitments or want to experience many locations before choosing a favorite, renting can give you that.
3. Homeownership requires more ongoing work
Generally, homeowners are advised to set aside 1% to 4% of their home’s value each year for ongoing maintenance costs. The maintenance and repairs of a rental home, on the other hand, are largely left up to the landlord. While the service quality may vary, it rarely comes at an additional cost to the renter. And this isn’t lost on those tenants: 55% of renters prefer renting to all of the expenses and effort of homeownership, according to the survey.
While DIY trends have grown significantly over the years — through popular culture on television and social media, and later through necessity during the early pandemic — not everyone wants to invest in the tools and time necessary to maintain their own home. And those homeowners who choose not to would otherwise have to do the work of hiring someone, another dreadful task.
4. You’re not convinced it’s a good investment
Well over half (59%) of renters don’t believe buying a home in the current market is a smart investment, according to the survey. Real estate investments, like most investments, don’t come with guaranteed returns. Even if you get a deal on a house and make improvements with the goal of selling it at a profit, things outside of your control (e.g., the economy, a pandemic, etc.) can have a significant impact on the outcome.
About one-third (34%) of renters are embarrassed to admit they rent instead of owning their home, but they don’t need to be. People who lease vehicles likely aren’t ashamed of their choice. Renting a home can be a perfectly logical decision, made after weighing the costs, benefits and how one option simply fits your life better.
Another strong jobs report finished off a remarkably solid year for labor in 2023. Among the highlights:
Job growth continued. The Bureau of Labor Statistics data shows the U.S. economy once again beat expectations for jobs gains at 216,000 for December, the latest in a 36-month trend of growth. For 2023, job growth came in at 2.7 million, with an average monthly gain of 225,000. By comparison, 4.8 million jobs were added in 2022, with an average monthly gain of 399,000.
Unemployment remained low. The unemployment rate stayed steady at 3.7%, and rates are on a streak of 23 months below 4% — a stretch unseen since the late 1960s, Bureau of Labor Statistics data shows.
Wage growth remains elevated. Wage growth came in at 4.1% over the prior 12 months — that’s good news for workers, but higher than the Federal Reserve might like as it determines when it begins cutting rates in 2024.
A tight labor market, falling inflation and persisting economic growth all form a strong economic picture heading into 2024. But high interest rates remain, as do elevated prices. NerdWallet spoke with Jared Bernstein, chair of the White House Council of Economic Advisers to get his take on Friday’s jobs report, consumer sentiment and the economic look ahead.
The following interview has been edited for length and clarity.
NerdWallet: In 2023, inflation fell, the labor market steadily cooled, we saw higher-than-expected GDP growth and avoided a recession. Many economists seem surprised that the Fed was able to ease inflation without tanking the job market or tipping us into a recession. Are you surprised at where we stand right now?
Jared Bernstein: I wouldn’t say I’m particularly surprised. And in fact, we’ve long argued publicly that the goal was to maintain the tight labor market while easing inflationary pressures. I think President Biden views that as a key way to both empower workers with the maintenance of the tight job market while giving families some breathing room with easing inflation and even some lower prices. Substantively, an important piece of this is recognizing that supply chain normalization and the improvement of the economy’s supply side — whether it’s logistical supply chains or the increase in labor supply — have also helped in that regard. And that’s a good way to reduce inflationary pressures without dinging the demand side of the equation.
NerdWallet: Last year, job gains were mainly in three areas: health care, government, as well as leisure and hospitality. How much of the 2023 job growth can we attribute to a rebound from the pandemic, and how much can we attribute to underlying economic growth?
Jared Bernstein: I think by the time you’re in 2023 a chunk of the rebounding is behind you. Certainly the biggest numbers. One way to think about this is that in ’21 the average monthly job gain was 600,000 a month — so that’s huge and it has some rebounding clearly embedded in it. And in ’22 the analogous number that’s the average monthly job growth was about 400,000. And in ’23 it was around 200,000 and 225,000. So there’s kind of a stepladder there that gets you more into a steady, stable growth path.
I think by the time we got into ’23, we really executed on the president’s plan to maintain a tight job market and to get wages rising. That is such a key — real wages beating prices. Look, in an economy that’s 70% consumer spending like this one, if American consumers are facing a tailwind of a strong job market and easing prices, rising real pay, that’s a pretty good forward-motion machine. I think that’s a lot of what we saw in ’23.
NerdWallet: So is there some economic vulnerability in having growth concentrated in so few sectors? Some of the more interest-rate-dependent industries, for example, have shown little to no growth. And other areas like transportation and warehousing that boomed during the pandemic are now seeing some decline.
Jared Bernstein: Well, I get paid to worry about everything, so I’ll never say, ‘Oh, nothing to see there,’ but I think that caution has been somewhat overplayed. Lots of industries created jobs. I think 70% of the industries contributed in ’23, some more than others, as you say. If you think interest rates are more likely to be down than up next year, then that should be helpful to some of the interest rate-sensitive sectors that you mentioned, upwardly speaking.
If I look at the sectors that did create the most jobs, some of them are very large and significant sectors — private services, for example. We saw some great manufacturing numbers this year, more in the first half than in the second half of the year.
We also know that we had good construction numbers, and not so much in residential buildings, but more in nonresidential. And I think some of that really links up to factories that are being built. There’s hundreds of billions of capital that’s come in from the sidelines supported by the Inflation Reduction Act and the Chips Act. We’re actively building manufacturing facilities in this country to stand up the domestic industry of chips with electric vehicles, batteries and that should lead to more manufacturing jobs once those factories come online.
“ Executing on the president’s agenda has led to a situation where things are looking a lot better than people thought they would. And I think as time goes on, we’ll see more positive reporting when it comes to consumer sentiment.”
Jared Bernstein, chair of the Council of Economic Advisers
NerdWallet: I want to shift to consumer sentiment and approval of President Biden’s economic management — both slumped for most of the year, but at least one recent poll shows that the tide may be turning in that respect. How do you understand the disparity between the economy’s many objective strengths and consumer discontent?
Jared Bernstein: Well, I think it takes some time for the dynamics that you and I have been talking about to reach into people’s lives, and there’s a consciousness deep enough that it shows up in some of these indices of confidence and sentiment. And that’s why the December numbers, as you suggest, are a positive glimmer there. It’s one month, so it’s not a new trend, but the consumer confidence survey was up 10%; the University of Michigan sentiment survey was up a whopping 14%; there was some other polling that began to show this morphing in the way you suggested.
I think one of the things that’s going on there, again, has to do with this intersection of the very strong job market while inflation is easing. So we see real wage gains; wages are beating prices now for 10 months in a row for middle-wage workers. A lot of economists and I think it was 90% of CEOs a year ago said we would be in a recession. So executing on the president’s agenda has led to a situation where things are looking a lot better than people thought they would. And I think as time goes on, we’ll see more positive reporting when it comes to consumer sentiment.
NerdWallet: Interest rates are something that’s obviously on the mind of the market and consumers. Can you comment on the effect today’s jobs report might have on the timing of Fed’s rate cuts?
Jared Bernstein: Yeah, no I can’t. We have much respect for the independence of the Federal Reserve. So I’m certainly not going to talk about that. But I can talk to you a little bit about inflation because, of course, it’s relevant.
At the end of the day, inflation is going to drive a lot of the result of that kind of question. So we know that inflation is down two-thirds from its peak. We know that the six-month annualized rate of one of the inflation gauges the Fed watches most carefully, the core PCE, is growing at just below 2%. So that’s a good sign for them.
We also know that actual prices probably get more into sentiment than the Fed. And we know that actual prices — not lower inflation, actually lower prices — are in place whether we’re talking about gas or bread, milk, eggs, toys, TVs, airfares, used cars, a lot of things that really spiked in price have come down in price. So we’ve had some deflation there. That helps with breathing room and, of course, that helps on the inflation side as well.
NerdWallet: Can you talk a little bit about the populations that fueled labor force growth in the last year, specifically women?
Jared Bernstein: When President Biden talks about empowering workers — and that’s a key pillar of Bidenomics — one of the things he’s really thinking about is the benefit of running a tight labor market, and the way they cascade to groups that have historically been underserved or even left behind.
So here’s a number you haven’t probably heard too much today, but it comes out of the report: If you look at the average Black unemployment rate for 2023, it’s 5.5% — that’s the lowest Black unemployment rate on record for an annual average going back to 1972, when the Bureau of Labor Statistics started collecting that data. If you look at the employment results for disabled workers, they’re shooting up very nicely. And, of course, women, in what we call prime age: 25 to 54. If you look at folks in their prime working years, women’s labor force participation broke records in 2023.
This is just what happens when you have a persistently tight labor market with the unemployment rate below 4% for 23 months in a row, 14.3 million jobs, 36 months in a row of job creation. It’s a great labor market. And it’s reaching folks who too often are left behind under weaker conditions.
Photo by Kevin Dietsch/Getty Images News via Getty Images
Mortgage rates barely changed this week, but experts still expect further declines in 2024.
The average rates for 30-year loans inched up to 6.62% from 6.61% a week ago, according to tracking by Freddie Mac on Thursday. Aside from this week’s minuscule rise, rates have been declining for weeks since late October, falling nearly 117 basis points from a 12-month high of 7.79% at the end of October.
Those recent declines have boosted homebuyers’ ability to purchase homes, but further affordability improvement could be curbed by a continual supply shortage, especially if lower rates bring back sidelined demand.
“While mortgage interest rates are expected to overall decline in 2024, minor fluctuations in weekly mortgage interest rates are to be expected,” Jessica Lautz, National Association of Realtors’ deputy chief economist, wrote to Yahoo Finance.
“The biggest demand is likely to come from those who had been priced out of the homebuying market. For spring, there will likely be competition among the steady share of all-cash homebuyers and first-time buyers trying to edge in,” Lautz added.
Read more: Mortgage rates decline. Is 2024 a good time to buy a house?
Rate drop improving affordability
The national median monthly mortgage payment on purchase applications fell by $62 to $2,137 in November from the month prior, according to the Purchase Application Payments Index (PAPI).
“Homebuyer affordability improved in November, with a decline in mortgage rates, providing relief to prospective homebuyers,” Edward Seiler, MBA’s associate vice president, said in a press release. “MBA expects that affordability conditions will continue to improve as mortgage rates decline, which should generate increased demand heading into the spring homebuying season.”
A decrease in PAPI — indicating stronger affordability — can be attributed to a reduction in borrowed loan amounts, a drop in mortgage rates, and an increase in incomes.
However, homebuyers’ ability to afford homes is still lower than a year ago. Mortgage applicants are paying $160 more, or 8.1% higher, each month compared to the national median mortgage 12 months ago. While rates didn’t increase substantially this week, homebuyers today are still paying 14 basis points more than 12 months ago, when the average 30-year mortgage rate was 6.48% on Jan. 5, 2023, according to Freddie Mac rates archive.
Read more: How to buy a house in 2024
Many experts are predicting further rate drops in 2024, though. As the US economy is expecting a soft landing — where inflation curbs without a national recession — rates are poised to drop to around 6% or potentially lower by the end of 2024.
“If inflation continues to show signs of improvement and the bond market remains less turbulent than during much of 2023, mortgage rates should at the very least stabilize this year, if not show sustained declines,” Jacob Channel, LendingTree’s senior economist, predicted for 2024 housing and economic market.
Affordability curbed by lack of listing
Housing experts warned that limited inventory could restrain affordability improvement achieved by declining rates. Without adequate supply, sidelined prospective buyers returning to the market could outpace the housing supply and increase competition.
“Homeowners may still be reticent to move from low interest rate mortgages, which may be in the 2.5% to 3.5% range, until they are in a situation where a life or job change occurs forcing them to reconsider their living situation,” Lautz said.
Total inventory of unsold existing homes, not including new constructions, declined 1.7% from the previous month to 1.13 million units at the end of November, according to the National Association of Realtors. This is the equivalent of 3.5 months of supply on the market, nearly 2.5 months lower than what experts believe to be a balanced and healthy market of 6 months.
For context, today’s existing home inventory levels are relatively close to the record low of 860,000 units in January 2022 compared to the record high of 4.04 million units in July 2007.
But inventory could still see a slight uptick as more sellers reach their “tipping point,” or the rate level at which homeowners are willing to sell their homes. Most homeowners — nearly 92% — have rates below 6%, Redfin says. But as rates drop to 6% or below, more owners could be open to selling. This would reverse the mortgage rate lock phenomenon that slowed the housing market in 2023 when most homeowners refrained from selling to keep their lower-than-market rates.
However, experts don’t expect a significant jump in inventory that could bring down home prices, as roughly 4 in 5 homeowners still have rates below 5%, and one-quarter have rates below 3%.
“We are not going to see a big turnaround,” Danielle Hale, Realtor’s chief economist, said on 2024’s affordability challenges during NAR’s Real Estate Forecast Summit. “But I do think we are going to see baby steps in the right direction.”
Rebecca Chen is a reporter for Yahoo Finance and previously worked as an investment tax certified public accountant (CPA).
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Tipping cultures can vary significantly between countries. While many service workers in the U.S. rely on tips as part of their compensation, that’s not the case universally. Between the U.S. and Japan, specifically, there is a huge difference in the tipping culture
In fact, travelers should generally avoid tipping in Japan. There are a few rare cases when a tip is appreciated. Let’s go through when tipping in Japan is appropriate and when you should show your appreciation with a heartfelt “arigato gozaimasu” (thank you).
Do you tip in Japan?
The short answer: No. In some situations, trying to leave a tip may be even off-putting. As wild as that may seem to American travelers, Japanese culture prioritizes excellent service without any expectation to provide a financial tip as appreciation.
Whether you get service from a restaurant server, bartender, hotel housekeeper or even a taxi driver, prices are set at a rate where workers are compensated with a fair wage.
For travelers visiting Japan, the general rule should be to avoid tipping. However, there are a few situations where a tip is appreciated. Here’s a breakdown of some specific dos and don’ts.
Do you tip at restaurants in Japan?
Travelers should avoid leaving a tip in restaurants in Japan. This is the case regardless of the type of restaurant — from counter service to a sit-down multi-course meal — and the quality of the service. The expectation is that prices are set at a rate that the owner will provide fair compensation to servers.
Some Japanese bars or izakayas may charge a small cover charge. This is typically referred to as “otoshi” and may or may not be posted at the entrance to the bar. Ask before being seated if you’re concerned about this charge (typically only a few dollars).
The telltale sign that you’ll be charged an otoshi is if you get a small appetizer upon sitting down.
Do you tip taxi drivers in Japan?
With Japan’s incredible public transportation, travelers should have little need for taxi drivers to get around. Because of this, Japanese taxi drivers generally provide top-notch service. From white gloves to automatically opening doors, taking a taxi in Japan is like no other. Again, your instinct may be to show your appreciation with a tip.
But here again, travelers will find their offer rejected. Don’t have exact change and want to round up? Many Japanese taxi drivers will provide exact change, down to the yen.
Do you tip tour guides in Japan?
One of the few places where tipping in Japan is appreciated is for tour guides and interpreters. What’s the commonality? These service providers primarily serve international tourists, many of whom are accustomed to tipping. For this reason, many tour guides and interpreters won’t turn down a tip when it’s offered.
To truly show your appreciation, do a bit of legwork beforehand and take a couple of small envelopes with you. Flashing cash is seen as inappropriate, particularly in public. Instead, place your tip in an envelope and hand it to your recipient with both hands.
Again, though, tipping isn’t expected in these cases, but it won’t come across as rude. Since there’s no expectation of a tip, there are no guidelines about how much to tip.
Tipping geishas and at ryokans
Geishas (female Japanese performing artists and entertainers)and ryokans (traditional Japanese inns with attentive service) are two ways to experience exceptional authentic Japanese service and culture. Considering the lack of tipping elsewhere in Japanese culture, it’s ironic these are two times when it can be appropriate to provide a tip.
When having a private dinner with a geisha, you can opt to provide an envelope with cash to show your appreciation. Currently, the custom is to give around $20 (3,000 yen) per person. This money should be in an envelope and handed to the geisha with both hands and a dip of your head.
At high-end ryokans, it’s appropriate for guests to show their appreciation with a tip for attendants or the owner, either at check-in or left on your bed at checkout. Here a tip of $7 (1,000 yen) per person is seen as customary.
Should you insist on leaving a tip in Japan?
In many Asian cultures it’s seen as polite for someone to turn down a gift on the first offer. This isn’t the case for tipping in Japan. If you attempt to leave a tip and the offer is politely rejected, don’t insist on providing the tip. While your offer may be perfectly well-meaning, it can come across as rude in Japanese culture.
Final thoughts on tipping in Japan
Traveling and experiencing different cultures can help you re-examine the cultural norms that you’re used to. For Americans, the lack of tipping in Japan can be one of those times for reflection.
In the U.S., it’s usually rude not to tip servers, bartenders and taxi drivers. The opposite is true in Japan. Even attempts of tipping in Japan can seem off-putting, as it can be interpreted as a sign that you feel the service worker isn’t fairly compensated for the price charged.
Instead, show your appreciation by learning about Japanese culture and memorizing some Japanese phrases.
Keep your voice down in public — except in izakayas — or other places where letting loose is expected. Be mindful of the appropriate places to wait to board trains and queue outside restaurants. Learn to hand and receive payment cards and business cards with both hands. And internalize arigato gozaimasu as the appropriate way of showing your appreciation for good service when visiting Japan.
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U.S. credit card balances continued to climb above $1 trillion last quarter, while the number of newly delinquent credit card users now tops the pre-pandemic average, a new report shows.
The uptick in borrowers who have fallen at least 30 days behind on their card payments appears to cut across income and geography, but it is “disproportionately driven” by millennials, credit card users with auto or student loans and those with higher credit card balances, the Federal Reserve Bank of New York said Tuesday in its third-quarter report on household debt and credit.
Millennials, who were born between 1980 and 1994, are now moving into credit card delinquency status at a higher rate — 0.4% — than they were in the third quarter of 2019, according to the report. The potential reason for the higher rate may come down to urgent bills — housing, education, child care — that may take precedence over paying off credit cards.
“Those are all reasons why young adults are struggling,” said Ted Rossman, a senior industry analyst at Bankrate.com who specializes in credit card trends. “It’s a cumulative effect. If you’re paying so much more for these things, it makes sense that credit card payments might slip.”
Researchers at the New York Fed said Tuesday that they are planning to do more research into why millennials are experiencing higher rates of delinquency compared to other generations.
One factor could be that older generations, who are more likely to be homeowners, may have benefitted from mortgage refinancing in recent years that lowered their monthly housing costs. Millennials, many of whom may not be homeowners yet, are dealing with higher rent costs.
Overall, household debt, including credit card balances, mortgages, auto loans and student loans, totaled $17.29 trillion in the third quarter, an increase of 4.8% year over year. Balances have grown by $3.1 trillion since the end of 2019, just before the pandemic started.
For the second consecutive quarter, credit card balances exceeded the $1 trillion mark, rising to $1.08 trillion as of Sept. 30, up from 16.1% from a year earlier, the New York Fed found. Credit card balances were $1.03 billion the prior quarter, up from $980 billion in the first quarter.
About 2% of all card users went from “current” status in the second quarter to 30 or more days past due in the third quarter, the report said. That’s up from 1.7% in the first and second quarters of this year, and it’s higher than the third quarter average of 1.7% between 2015 and 2019.
The increase in credit card delinquencies last quarter comes on the heels of what had appeared to be a stabilization of past-due payments, particularly among subprime borrowers who in general have been more likely than other borrowers to be late on their card payments.
During the third quarter, the rates of transition into delinquency status increased for all loan categories except student loans, the New York Fed found. About 8% of credit card balances moved into delinquency status, with borrowers between the ages of 30 and 39 seeing the sharpest increase in credit card delinquency for the quarter, according to the report.
Banks as a whole are not yet sounding alarm bells about rising credit card delinquencies. But several are pointing to “normalization” trends that include an uptick in past-due payments.
At Capital One Financial in McLean, Virginia, the 30 days’ past due delinquency rate increased to 4.31% during the third quarter, up 134 basis points from the same quarter in 2022, Chairman and CEO Richard Fairbank said on the company’s third-quarter earnings call. The monthly delinquency rate and monthly charge-off rate are “now modestly above 2019 levels,” he added.
Meanwhile, Synchrony Financial of Stamford, Connecticut, said its 30-day and 90-day past-due payments are now “approaching 2019 levels” as credit trends continue to return to normal.
“Overall, our credit performance remains within our expectations,” Chief Financial Officer Brian Wenzel Sr. told analysts during the firm’s third-quarter earnings call. At the same time, the $113 billion-asset card issuer is “continuously monitoring” its card portfolio and has “implemented further credit actions,” such as tightening some of its loan origination criteria, Wenzel said.
Rossman of Bankrate.com called the overall increase in card balances “striking,” but added that “all things considered, I think the consumer has hung in there a lot better than expected.”
Still, he’s beginning to wonder when the impact of inflation and higher interest rates will widely, and negatively, impact consumers, who are by and large still in spending mode, he said.
The job market will be one area to keep watching, he said.
“I do think we’re getting closer to a tipping point in terms of excess savings, which has pretty much been exhausted at this point,” he said. “We’re getting to the point where something has to give. People will have to spend less or these debts and loans are going to become increasingly difficult.”
Inside: Are you unsure about how much to tip your valet? This guide will help you understand valet parking tips and the dollar amount for tipping at hotels and restaurants.
Navigating the ins and outs of tipping etiquette can be daunting, particularly when it comes to highly personalized services such as valet at five-star hotels.
You certainly want to show appreciation and respect for the quality service they provide, while inherently being cognizant of not going over the top. From the length of your stay to the level of service rendered, the cost of parking, and even the locale, several factors can sway this figure.
Parking can be a hassle, and that’s where valets step in. They’ve got your back, navigating tight spaces and dodging traffic to park your vehicle. But what do you owe them in return for their hard work and risk?
Honestly, this is a similar question of wondering how much to give for high school graduation.
This guide dissects the intricacies surrounding valet tipping, helping you confidently reward exceptional services without breaking any unwritten societal norms.
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How much should you be tipping your valet?
The rule of thumb for tipping valets is $3 to $5 when dropping off and picking up your vehicle.
This is your baseline, but don’t hesitate to scale up if your driver impresses you with their service. If you’re staying at a place just for a night, a tip of $5 to $10 is seen as appropriate. For multiple nights, you may tip more generously on your first and last night.
Always remember, that your generosity reflects the level of service you’ve received.
The average tipping amount will vary in areas like New York City, Boston, Chicago, anywhere in California, or even Aspen, Colorado as these areas demand a higher tip.
What is proper etiquette for tipping valet?
Proper etiquette for tipping valet is about communication, patience, and gratitude. Ease into the drop-off zone without creating chaos, let your valet know about any special needs or quirks about your car, and stay patient. Afterward, express your thanks with a tip.
Yes, that means you need to have cash on hand.
It’s no crime to ask your valet what’s common for a tip if you’re not sure. This opens up a dialogue and they’ll understand you’re considering their efforts. Whether you tip before or after is wholly your call, but keep in mind that a tip at the start might earn you that extra mile of service.
Be generous, but fair. If you’re pulling up in a more luxurious car, consider a higher tip. The value of your vehicle is a good indicator of your tipping ability.
That said, only tip if you want to and think the service merits it. If your experience was less than satisfactory, bring it up to management instead of slipping a bill. Not tipping isn’t rudeness on your part if the service didn’t meet your standards. But if it did, good etiquette is acknowledging that quality service with a tip.
Valet Parking 101
Valet parking is an efficient service often offered in high-end restaurants and accommodations, providing a hassle-free parking experience, especially in areas that are limited in parking space.
The basics to avail of these services is to drive into the drop-off zone and hand over your vehicle to the attendant, ensuring you’ve removed any personal items and communicated any particularities about the car.
Valet parking etiquette isn’t complex. However, if you are well prepared, it makes the experience more delightful.
Be Alert at Drop-off. Drive with care into the drop-off zone and follow any directions from the valet. Don’t be in a hurry!
Prepare Your Vehicle. Have your car ready for valet parking by removing all personal and valuable items before arrival.
Communicate. Brief the valet about your vehicle’s quirks and intricacies, like touchy brakes or an alarm system.
Show Patience. Give the valet time to park, retrieve, and return your vehicle. They could be overwhelmed with multiple tasks during peak hours, so don’t rush them.
Show Gratitude. Beyond tipping your valet, express your gratitude verbally. A simple ‘please’ and ‘thank you’ can make their day.
Keep the Ticket Safe. You don’t want to hold up the process because you misplaced the claim ticket.
Respect the Flow. Respect the orderliness at the vehicle drop-off zone. The valets have an efficient system for quick drop-offs and pick-ups.
Prep for the Evening. Make sure you have everything you need for your event or stay. The valet can retrieve items from your car, but it’s best to avoid extra trips.
Remember, these simple considerations can greatly affect the smoothness of your valet experience.
An important note – if the driver who retrieves your car is not the same one you gave it to, you might want to tip both.
To Tip or Not To Tip? The Valet Parking Conundrum
With tip-flation out of control in the United States, you may be wondering if tipping your valid is worth it.
Sometimes, tipping can get situational. Let’s consider times when you might tweak the ‘usual’ amounts.
If you’re arriving during peak hours or on a busy weekend, tip more generously. Your valet is juggling a higher volume of cars and more stress, so your tip is a recognition of that hard work. On the other hand, slower hours might warrant a more modest tip.
Your vehicle type should also influence your tip. Driving a luxury or high-end car? That’s a premium charge for your valet, too. Running a more modest set of wheels doesn’t demand the same generosity.
Did your valet go above and beyond? Offering assistance with bags, driving directions or just a friendly demeanor might earn them a little extra.
Forget something in your car? Ask your valet to bring it back, but remember to compensate for their time. If you’re accessing your vehicle multiple times in a single day, consider an additional tip for the added service.
And finally, if you want to ensure your car gets a prime spot, or preferential service, tipping more upfront can help.
All in all, pay attention to how much to tip a valet given the situation. Tip when you feel the service warrants it and remember, it’s not just about the money – the thought counts too!
Should service quality affect your tip?
Absolutely! Service quality is a big factor in how much to tip a valet. Just like you might adjust a restaurant tip based on service quality, you should do the same with valet parking.
For example, if the valet is unfriendly, rude, or handles your vehicle poorly, they shouldn’t expect a hefty tip. At its core, the tip signifies gratitude for good service. Do keep in mind that errors happen, though. If a mishap occurs, such as a delay or a minor mistake, consider informing the manager rather than taking it out on the tip.
Conversely, if your valet provides outstanding service, they should be rewarded appropriately. So, if they treat your vehicle with care, offer assistance with luggage, close your trunk, or provide useful information about the locale, you might want to tip more.
Remember: Adjusting your tip based on the quality of service is not being stingy or overly generous; it’s fair compensation for service rendered.
Do you tip valet before or after?
Tipping before or after for valet service is rather circumstantial and both have their merits.
Tipping upfront might ensure your valet goes the extra mile for you.
Whereas, tipping at the end allows you to assess the service quality first.
The choice is entirely up to your discretion and how you feel about the service!
The misconception is you can get away with not tipping at all.
How much do you tip a valet at a hotel?
The standard courtesy tip for a hotel valet hovers around $5 per car. But hold on, as these aren’t hard-set.
Staying the night? Then consider a tip of $5 to $10; more if it’s for multiple nights.
Meanwhile, high-end hotels usually see higher tip values. A $5 to $10 tip per vehicle is considered suitable given the upscale services rendered.
Remember, the situation might vary depending on a gazillion factors like the destination, hotel class, length of stay, and level of service received. So equip yourself with a tipping strategy best suited for your specific scenario.
When they retrieve your car after your meal, how much should the valet parking tip be?
The baseline remains the same, you’re looking at a minimum of $3 to $5 per car.
But say the meal was special, the night was beautiful, or maybe you’re just in a good mood. Feel free to upgrade a little more to that tip. After all, it’s a token of appreciation for the valet who’s been managing your car while you dined in comfort.
In contrast, suppose their service was not up to your expectations. Maybe they made you wait too long or were discourteous. You then have a valid reason to tip less.
What if you don’t have enough cash?
If you are like me and find yourself without enough cash, there are still a few options to consider.
Ask if their valet services allow tipping through a credit or debit card or even Venmo, although cash is generally preferred.
Give a larger dollar bill when you are leaving the restaurant or checking out of the hotel.
When trying to determine how much cash should I have in my wallet, remember what you may need for tipping your valet.
Regardless, it’s always a good idea to keep some cash on hand for gratuities, to avoid inconvenience or potential embarrassment.
Hospitality Valet Expert Speaks
Jorge, a seasoned valet from the Grand Hyatt Vail, shared some fascinating insights into his job.
Despite the physical demands, Jorge takes pride in delivering exceptional service, swiftly handling numerous vehicles, and making guests’ transitions as smooth as possible. He underlined that gratuity is a crucial appreciation of this labor-intensive service.
Much like the data-driven research suggests, Jorge finds that guests who tip considerably when dropping their car off often get retrieval of faster service.
Also, he noted that tips are shared each day among the valets. This was to ensure there wasn’t favoritism and that all guests received the same service.
Why tip valets?
Valets offer a luxury service. They work hard to save you the hassle of parking, allow you to directly access your venue of choice, and take care of your vehicle in the process.
Valets are also part of the service industry, which means their income often depends heavily on the tips they receive. They brave the elements, handle the stress of navigating unaccustomed vehicles through tight spots, and often do so with a smile on their faces.
Not to mention, they’re on their feet for entire shifts, often dealing with demanding clientele and long working hours. By tipping your valet, you show appreciation for their hard work and encourage them to keep up the high level of service.
Why not show your gratitude with a few extra bucks? It’s a small price to pay for convenience and quality service. So, the next time you pull up to the drop-off zone, remember, your valet deserves that tip.
What do valets expect?
Valets, like other service industry professionals, expect respect and decent compensation for their hard work. This not only includes a fair hourly wage but also tips for the service they provide.
Valets typically expect a tip of around $3 to $5 per vehicle, although this can vary based on location, type of establishment, and how busy it is. In upscale areas, tips can range from $5 to $10 per car.
Additionally, valets appreciate when customers are understanding and patient, especially during peak hours. They also value clear communication about any special requirements or characteristics of your vehicle.
What’s considered a “good” tip?
A “good” tip for a valet typically starts at $5 per vehicle. This is generally considered the norm at most establishments.
However, a “good” tip can depend on several factors, like the establishment and service quality. At high-end hotels or restaurants, or in more upscale locations, a “good” tip might start around $10 or even $15.
With that in mind, treat your personable, hard-working valets to a good tip when they provide a great service. After all, a good tip results in good karma!
FAQs
Yes, you should still tip even if the valet service is complimentary. The valet is parking your car, often in the tight valet lot. Their service saves you time and stress, and that’s worth a tip.
Remember, many valets earn a small hourly base pay and rely heavily on tips. Their pay may not correlate with the price you pay or don’t pay, for the service.
A $20 tip for valet is usually seen as generous. It’s well above the typical range of $3 to $5. However, if you feel the service was exceptional, you have a high-end vehicle, or if the valet went above and beyond, such a tip could be appropriate.
Tipping valets at 5-star hotels usually follow a higher standard. Considering the upscale locale and high level of service, a good starting point is around $5 to $10 per vehicle. So, yes, $20 is a good tip for valet.
Furthermore, if the service exceeded your expectations, or if the valet provided additional help like carrying your baggage, a tip on the more generous side might be appropriate
Now, How Much to Tip Valet Driver?
In the United States, tipping is very much a part of our culture and how many people make their living.
Tipping valet can seem intricate, but it’s straightforward once you know the ground rules: anticipate, be kind, respect the service, and tip accordingly. It all comes down to recognition of the efforts your valet puts in to make your experience easier and classier.
The takeaways are the general tip range ($3 to $5).
However, you need to base your tip on the type of establishment, time of day, and quality of service. Be aware of the situation and tip accordingly. But, above all, remember to appreciate good service and acknowledge it accordingly.
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If you’ve ever taken an Uber, you’ve probably been asked to add a tip and rate your driver at the end of the trip. Some internal questions that may arise shortly after are how much should you tip or whether to tip at all.
Tipping can be tricky business, especially when it comes to rideshare services like Uber or Lyft because there isn’t a clear standard. Here is a guide to tipping Uber drivers that may help next time you take a ride.
Do you have to tip an Uber driver?
Uber doesn’t make tipping mandatory, so there’s no requirement that you tip your driver. However, just like other workers in the service industry, Uber drivers often rely on tips to supplement their pay.
Uber rolled out its in-app tipping feature in 2017 as an effort to improve drivers’ earnings. Tipping can be a way to support that mission if it’s something that aligns with your values.
Another reason you may choose to tip an Uber driver is if they give you a top-tier experience. An Uber survey shared by the tech company in 2018 found some reasons that riders tip drivers include: having a clean car, sharing a good conversation, helping with luggage, making a phone charger available and playing good music.
How much should you tip an Uber driver?
After completing a ride, Uber suggests tipping your driver and prompts you to give a preset dollar amount — such as $1 or $5 — or enter a custom amount. You can stick with one of these suggestions or give a more generous tip if you want. If you need a benchmark, consider calculating your tip based on the total ride cost.
In the service industry, restaurants sometimes make the standard tip clear by leaving recommended percentages at the bottom of receipts or as a pop-up on the machine used for credit or debit card payments. Some restaurants suggest tipping between 15% to 20% of the bill — a benchmark you could also apply to Uber rides. For instance, if you take a $35 ride, you may decide to tip $5.25, which is 15%.
In the event an Uber driver delivers poor service, you may choose to give a smaller tip or nothing at all, similar to at a restaurant or bar.
How much do Uber drivers make per hour?
The average hourly pay of an Uber driver can range from about $8 to $31 an hour. That said, Uber states there are three major factors that impact how much drivers make: fares for trips, tips from customers, and Uber promotions that offer drivers extra cash for completing certain trips. The amount drivers get for rides also depends on the city they live in, how many hours they drive and how far they travel.
Most drivers aren’t taking home the average hourly rate because they incur so many expenses. For one, Uber charges a variable service fee for some trips. In addition, Uber drivers are independent contractors, which essentially means they’re self-employed and not covered by health insurance, retirement plans, employer matches and other benefits. Drivers also have to pay for expenses like their car upkeep, self-employment taxes, and gas out-of-pocket. Keeping all these costs in mind, even if a driver’s earnings are on the higher side, expenses can eat away at the take-home pay.
What happens if you don’t tip?
There is no consequence for not tipping. However, it can be a kind gesture, especially for drivers who rely on tips. While some argue that it’s an employer’s responsibility to pay service workers better wages, drivers offer a service that makes your life easier. For that reason, you may consider giving them a few extra bucks. If you can’t afford to tip, consider using cash-back credit cards to pay for your rides and your tips so you get some dollars back.
Warning that the housing market is contracting again as today’s mortgage rates hover near 8%, Wells Fargo economists wrote in a new analysis that rising borrowing costs “stand to tip the housing sector back into a recession.”
The “ominous” special commentary posted Thursday, according to a Wells Fargo news release, states prospects for a housing rebound are dimming as mortgage rates tighten their grip on the already sharp U.S. housing affordability issues.
Even though the economy has shown “a remarkable degree of resilience” this year — and a strong labor market along with moderating inflation has “raised hopes that the U.S. economy can avoid a recession — the same can’t be said for the real estate market. Unfortunately, not every sector of the economy has been as sturdy in the face of rising debt costs,” the Wells Fargo economic group wrote.
“After generally improving in the first half of 2023, the residential sector now appears to be contracting alongside the recent move higher in mortgage rates,” they continued. “Although mortgage rates may gradually descend once the Federal Reserve begins to ease monetary policy, financing costs are likely to remain elevated relative to recent norms.”
The commentary comes days after Goldman Sachs analysts also issued a downgraded housing forecast, predicting “higher for longer” mortgage rates will continue to squeeze home inventory and yet home prices will stay in the green, though growth will be slight as sales slow even more.
It also comes a day after the Federal Reserve Bank of Atlanta posted an update to its Home Ownership Affordability Monitor, showing housing affordability sank to a “new record low” in August due to still stubbornly high prices and rising interest rates.
In yet another month of declines, the monitor index score sank to 67.3 in August with a national median home price of $377,500, a median income of $76,621, a total median monthly payment of $2,848 and an interest rate of 7.1%. The Atlanta Fed estimated the annual total payment share of median income to be 44.6%, well over the recommended 30% of income for housing costs.
Compare that score to a score of 112.3 in November 2012, when the median home price was $197,333, median income was $52,161, and the interest rate was 3.4%.
This latest affordability reading was back in August, before interest rates inched closer to 8%, hitting that threshold last week before tipping down only slightly, according to Mortgage News Daily.
This “higher for longer” interest rate climate is likely to “not only weigh on demand, but could also constrain supply by reducing new construction and discouraging prospective sellers carrying low mortgage rates from listing their homes for sale,” Wells Fargo economists wrote.
The bank’s analysts also downgraded their home price forecast, though now they expect a “slightly softer pace of home price appreciation in the years ahead.” Because high interest rates are expected to continue to both dampen demand and constrain supply, they predict those dynamics will continue to buoy home prices slightly.
“Higher financing costs are likely to both weigh on demand and constrain supply, which will allow home prices to maintain a positive trajectory,” Wells Fargo economists wrote, predicting the S&P Case-Shiller National Home Price Index to increase 1.8% in 2023 and 2.5% in 2024.
The economic group also predicts a “downshift” in new residential construction starts, with multifamily permits already declining sharply in recent months.
“The recent drop in home builder confidence is evidence that single-family construction may begin to moderate as higher mortgage rates test builders’ ability to offer rate buy-downs to attract new buyers,” they wrote. “That noted, a structural shortfall of single-family supply will likely continue to boost new development.”