Mortgage News

The National Association of Realtors (NAR) Reported the sales of previously owned homes which accounts for a vast majority of all home sales in the US.

Existing sales bottomed out in January at 4.00 million units annually. March numbers came in at 4.44 Million though nice, which was slightly lower than February at 4.55.

Looking at the chart below, it’s hard to overlook the correlation between rates and home sales. This chart helps clarify my 5.0% rate comment yesterday to help motivate potential sellers.

Its Friday enjoy your weekend and I will see you right here Monday.

90% of Homeowners have interest rates below 5.0% and 70% of those Homeowners have rates below 4.0%. – CNBC News

Interest Rates have to move lower before we can begin to sway these Homeowners in bulk. Lets look at a $500k purchase 20% down just Principle and Interest:

3.5% rate $1,796 6.5% rate $2,528

Our gut tells us it must be twice the payment but it’s actually only about 30% higher. What this tells us is once we are closer to 5.0% interest rate the payment shock will be far lower at only15% higher payment.

Interesting group below. These are digital nomads that can work anywhere, not just in the United States but the World. COVID has changed our working landscape far more than we may realize.

Have a fantastic Thursday.

Good Morning, headed to a Realtor conference so this one will be short. See link to my video regarding Inflation vs Mortgage rates .

Have a fantastic rest of your week.

Housing Starts in March were down by almost 1%, 17% from last year. But single family starts rose almost 3% last month.

Housing Permits i.e. future supply, down 9% from last month and 25% from last year.

We are still undersupplied.

Have a great rest of your week.

We sweat the small stuff because that’s the flame that starts the fire.

This is more of a personal note about our process and how we avoid problems from showing up. Our team is dedicated to ask the hard questions and document what might be an issue before it becomes an issue.

We don’t want to be your friend because friends will tell you what you want to hear, not what you need to hear. If I see something off with the income, I am going to ask. if there are unusual deposits, let’s find out what they are today not at closing.

Mortgage Bonds are having a tough time of it today. We have NAHB Housing Market Index, Housing Starts and Permits and Jobless claims this week.

Consumer inflation dropped from 9.1% to 5%, Producer inflation dropped from 11.7% to 2.7%.

Retail Sales in march fell 1.0% more than the expected 0.4%. Core Retail Sales which strips out automobile sales and gas, fell .03%. The expected drop was 0.5%.

Industrial production or output increased 0.4% in March was double the estimates of 0.2%. This shows that factories are at greater capacity than expected and could be inflationary.

This is putting some pressure on the bond market i.e. slightly higher rates.

Its Friday, what a week. Below is a Gallup Poll from 2000 Americans’ Cell phone Ownership and intentions.

The March Producer Price Index (PPI) report showed a decrease by 0.5%. This is a big deal. We continue to see rate improvement and expect this trend to continue. Inflation rate graph below.

The Feds are still expected to do one more 25bp hike in May but let’s see.

It’s Thursday morning, the weekend is just a day away. Enjoy the rest of the week.

Is a common expression that means don’t waste your time or effort on something that is pointless or unproductive.

We worry about everything while the world continues to move on with or without us. You ask, what does this have to do with the mortgage industry?

Quite a bit. Consumer sentiment plays a critical role and a gloomy sentiment weakens demand for goods and services, impacting corporate investment, the stock market, and employment opportunities, among other things.

Look at the graph below. Inflation is down on all measurements. It’s down significantly and quickly. The world has moved on, catch up.

It’s Wednesday, I’m off to a Realtor meeting this morning.

And just to be clear… This is good news. Get out there and make some noise.

If we think back the last two years from an inventory perspective, you may not realize how few homes were actually for sale. We are still well below the average but moving in the right direction.

One of the challenges we all face is analysis paralysis. Everyone wants to make the right decision but can’t. We sit here in limbo waiting for the other person to flinch.

This last part is for potential sellers, Home prices are up as Inventory is down. One more time, Home prices are up as Inventory is down.

The Fed has raised the benchmark interest rate from zero 12 months ago to 4.75%. This is the steepest rise in US borrowing costs since the 1980s. All to squash inflation.

Higher rates encourage savings over spending. As more consumers stop buying goods, those employed to produce those goods lose their jobs.

The March inflation report will be coming out Wednesday. These numbers are replacing last years and reflect a year over year change. Expectation no change or higher.

Zillow Home Value Index shows home prices rose 0.9% in March, the highest since the peak in June 2022. Home prices are up 3% year over year. Inventory is still the biggest challenge. It keeps home values up but makes it difficult for buyers with multiple offers.

We have a busy week with the Consumer Price Index Wednesday, Initial Jobless Claims Thursday and Retail Sales this Friday.

Its only Monday morning but feels like the middle of the week.