TODAY’S RATES & HOUSING NEWS
Interest rates moved up quickly last week, but we have some positive momentum this week.
On the week of the 4th of July, the Mortgage Backed Security (MBS) market went down -119 bps.
As of this writing, the MBS market is up +60 bps so far this week which has helped erase some of the rise in rates.
So why have rates moved up most of June and now going into July?
The simple answer is we keep getting positive reports about the economy despite the FED doing all that they can to slow down the economy.
Raising overnight bank rates (The Federal Funds Rate) causes banks to raise the interest rates they offer consumers.
Higher rates typically equate to less demand for buying goods and services.
Less demand to buy goods and services helps lower inflation.
I personally believe that much of the economic momentum in the jobs market is being fueled by part-time jobs.
I also believe that a lot of the economic spending is being fueled by credit cards and home equity lines of credit.
With US credit card debt at an all-time high, I believe that consumers that have lost their job or are making less money are relying on credit cards
and Home Equity lines of credit to maintain their normal spending habits.
The BLS Jobs report was released on Friday and finally we received a jobs report lower than expectations.
The 209,000 jobs created were less than the 240,000 expectation and BLS did negative revisions of -110,000 jobs for April and May.
The CPI Inflation report comes out Wednesday and this is one to pay attention to.
The FED has made it very clear that their goal is 2% inflation. We expect inflation to drop in the 3% range – hopefully in the low 3%’s.
We also expect the FED to raise overnight banking rates at their meeting later this month.
Below is Green Home Loans rate sheet today.
Along with Mortgage News Daily average rate across the country.
IMPACT OF CHANGING MORTGAGE RATES
HOME PRICES HIT NEW PEAKS
Black Knight’s Home Price index hit an all-time high – rising .7% from April to May.
The 2023 housing momentum has erased the losses of the second half of 2022.
According to Black Knight, “Twenty-seven of the 50 largest U.S. markets have returned to their previous price peaks or set new ones this spring. See article here: https://www.mortgagenewsdaily.com/news/07102023-black-knight-mortgage-monitor
KEEPING CURRENT MATTERS JULY MARKET REPORT:
Here is the recording for July’s market report: https://files.keepingcurrentmatters.com/content/assets/audio/20230710/KCM-July-2023.mp3
Please email firstname.lastname@example.org if you would like access to video and slides.