Posts

Rates Keep Falling & Will Fall More; Timing The Market

Rates fell again primarily in response to negative economic data, including revised data that showed the economy shrunk more than we thought in Q1 along with more recession indicators and predictions. The 10 Year Treasury, which correlates closely to mortgage rates, hovered near 3.5% only a few weeks ago – but it is now under […]Read More

Good News! Recession Coming Soon; Rates Continue to Fall After Fed Raises “The Rate”

A week ago, I pointed out how the recent 0.75% increase in the Fed Funds rate resulted in LOWER long-term rates. I highlighted three reasons for this: (1) The markets perceived the news as effective inflation fighting; (2) the markets expected the news and had priced it in already; and (3) the Fed Funds rate […]Read More

High Rates; Softer Market; ARMs; Housing Shortages; Recessions; Refis

Highest Mortgage Rates Since 2009 Last week’s sky-high inflation numbers have pushed 10-Year Treasury rates to levels we have not seen since 2018. While mortgage rates are at levels we have not seen since 2009. Beating A Dead Horse – Again The fast-climbing rates and media rumblings continue to spook buyers – so I am […]Read More

Why We’re Seeing Fraud Claims Now & Will See A Lot More

I knew and worked with a bunch of hard money lenders (who loaned money based strictly on equity) prior to the 2008 meltdown. Even though they were a bit cocky with their success and they lived like rockstars, they were all nice and honest guys for the most part. They solicited pools of funds from friends, family members, and outside investors – and then loaned out that money to homeowners and homebuyers who could not qualify for better financing.Read More

History of Interest Rates; Some Perspective

Are Rates High? Yes, rates are 2% higher than they were when they bottomed out after COVID hit and they are back to the 2009 levels, but are they “high?” No. Not even close when we look at the history of rates over the last 50 years. Here is a link to an excellent interactive […]Read More

Fastest Rate Increase Since 1981; Will Recession Lower Rates?

The Fed has engineered the fastest increase in mortgage rates since 1981 – as rates have nearly doubled over the last several months. And, interestingly, housing continues to appreciate for the usual reasons we cite often: (1) inventory remains at record low levels primarily due to a lack of building, not demand, since 2008; (2) demand remains stronger than ever primarily as a result of demographics or millennials hitting homebuying age; and (3) affordability has not been affected as much as people think because incomes have risen with inflation.Read More

Recession Coming Soon – Will It Bring Down Rates?

Barry Habib of MBS Highway fame was recently on the National Real Estate Post, discussing interest rates because that is what he does. Once again, I love quoting Barry because he has been one of the most accurate prognosticators in the vast realm of economic punditry. Also, his 20-minute interview is not behind a paywall, […]Read More

Why Did Interest Rates Fall After The Fed Ostensibly Made Them Rise?

The Fed recently raised rates, but interest rates fell in response. This is something we see so often that I had to blog about it – to again allay some of the confusion about the Fed’s rate increases. Rates are way up now, but recently they fell at least 1/8% AFTER the Fed announced the […]Read More

Inflation & Rates Increase But Industry Experts Still Bet On Low Rates

The current surge in commodity prices such as wheat, nickel, copper, and oil is fostering doom and gloom predictions – of mass shortages and runaway inflation. So, in light of that, why is Raoul Pal, the founder and CEO of “Real Vision” buying bonds in a bet that interest rates will fall? Pal thinks higher prices will crush demand and that a recession is looming.Read More

“Rising Bond Yields Ease Recession Fears” Does It Matter?

The title of today’s blog is from this recent WSJ article (as always, we can send key excerpts to non-subscribers). The article quotes Fed Chairman Jerome Powell, as he pointed out how strong consumer spending and employment numbers indicate that the U.S. economy remains robust and should retain its health into the near future. Inflation […]Read More

Will a Recession Tank Housing Prices? Probably Not…

I know numerous people who are anxiously waiting for the next recession b/c they expect housing prices to tank. They can’t wait to swoop in and find bargains like the many that were available after the 2008 meltdown. BUT, according to Appraisal-Blogger-Extraordinaire, Ryan Lundquist, housing prices don’t always “correct” or decrease during recessions. Prices often […]Read More

Why Nobody Takes ARMs (Adjustable Rates); Inverted Yield Curves; Recessions

SELLING ARMS IN THE 1990s There was an event in 1995 that gave a wonderfully powerful jolt to my book of business. A sales rep from a lender called LaSalle came by our office and told us about the Adjustable Rate Mortgages (ARMs) his firm offered. They were 5 and 7 year ARMs in the […]Read More

The Fed Halts Rate Increases; Good Or Bad?

Yesterday, the Fed announced that there will be no more rate hikes in 2019. And many people in the mortgage and real estate industries cheered. But a lot of economists and Fed-watchers are more worried than ever. Here is just one of many articles (from the WSJ) I read today illuminating serious concerns. The Fed […]Read More