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Category: Newsletters

Worst Day For Rates in More Than a Year After Jobs Report, But It’s Not as Bad as it Sounds

Interest rates have a long and reliable history of reacting to the jobs report more than any other monthly economic data and the most recent example sent mortgage rates screaming higher at the fastest pace in over a year. Labor market strength = higher rates, all other things being equal, and Friday’s NFP or “nonfarm…
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Highest Mortgage Rates in More Than a Month, But There Are Silver Linings

So far, 2024 has been distinctly different from the end of 2023. November and December saw rates move lower at one of the fastest paces in decades. In contrast, January has delivered a fairly consistent uptrend with the average lender now at the highest levels in more than a month. Frustratingly, widespread media coverage suggested…
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Let’s Talk About The Spread Between Mortgage Rates And The 10yr Treasury

Seemingly overnight, there is widespread media attention on the spread between mortgage rates and the 10yr Treasury yield. There shouldn’t be. Why are we talking about the 10yr Treasury yield if we’re focused on mortgages and housing? Simply put, the 10yr Treasury note is the most dominant benchmark (touchstone, bellwether, yard stick, etc) for all…
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Calm Week to End Not-So-Calm Year

While this week was uneventful and while 2022 was more volatile in terms of movement in the housing/mortgage market, we can still reflect on 2023 as a year of extremes. Incidentally, that thesis is supported by some of the only economic data released this week.  Pending Home Sales came out perfectly unchanged from last month,…
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Have Rates Improved Too Quickly And Is The Fed Being Rational?

The astonishing pace of the recent drop in interest rates has raised some questions regarding sustainability and justification, but we can clear them up with a single chart. The Federal Reserve doesn’t ultimately dictate rate levels, but it has a huge impact on how rates move.  The Fed has been credited with fueling the improvements…
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What’s at Stake With Next Week’s Fed Announcement and Inflation Data?

It was mostly a great week for mortgage rates with the average lender near the best levels in months through Thursday. Friday’s jobs report pushed rates back up a bit, but not excessively. Next week’s two big ticket events could set the tone for the rest of the year. Ultimately, that’s exactly what’s at stake.…
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Housing Market Thankful For Lower Rates But The True Test is in Early December

Mortgage rates have fallen significantly in November. For the housing market, it couldn’t come at a more critical time, but the road ahead remains uncertain–mostly due to timing. Here’s what we’re up against in terms of home sales (includes the most recent monthly result released this week): Keep in mind that the market for EXISTING…
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Cooler Inflation Prompts Big Shift in Rate Outlook

The Consumer Price Index (CPI) is one of two big, monthly economic reports that have the strongest track records of causing volatility for rates.  This makes sense considering inflation is the primary reason rates are as high as they are. Other economic data matters too.  The other big report is the Employment Situation, typically referred…
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Lots at Stake For Rates Next Week; Which Housing Report is Telling You The Truth?

This past week brought the release of two housing reports that track the pace of home sales each month and they told distinctly different stories. Which one is telling the truth? The reports in question are New Residential Sales from the Census Bureau and Pending Home Sales from the National Association of Realtors.  The former…
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Doom, Gloom, Kool Aid, And Warm Porridge

Mortgage rates finally broke the 8% ceiling this week after months of gradual upward movement in the 7% range. At the same time, Existing Home Sales fell to the lowest levels in more than a decade. Pretty gloomy… but there are silver linings and perhaps even some overly optimistic Kool Aid to drink. As always,…
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