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21st March, 25
Small Scale Weakness Leaves Bigger Picture Unchanged
Small Scale Weakness Leaves Bigger Picture Unchanged Bonds began the day in stronger territory after tracing a risk-off move in the overnight session. Much like yesterday, 9:30am brought a momentum reversal, both for stocks and bonds, thus beginning a slow march back into weaker territory. Bonds might have stayed green if not for tariff headlines at noon ET which resulted in a modest nudge for stock prices and bond yields simultaneously (probably... it was so small that it could easily be seen as noise). Either way, the bigger picture was completely unaffected. Bonds are sideways
Small Scale Weakness Leaves Bigger Picture Unchanged
Small Scale Weakness Leaves Bigger Picture Unchanged Bonds began the day in stronger territory after tracing a risk-off move in the overnight session. Much like yesterday, 9:30am brought a momentum reversal, both for stocks and bonds, thus beginning a slow march back into weaker territory. Bonds might have stayed green if not for tariff headlines at noon ET which resulted in a modest nudge for stock prices and bond yields simultaneously (probably... it was so small that it could easily be seen as noise). Either way, the bigger picture was completely unaffected. Bonds are sideways
21st March, 25
Highest Existing Home Sales in a Year
As is the case with a majority of housing and mortgage market data these days, the Existing Home Sales data from NAR is heavily dependent on context. To be sure, the headline is true. You'd have to go back to report that came out in February, 2024 to see a higher annual pace of sales. (NOTE: the table above contains initially-reported numbers. NAR subsequently revised the 3/31/24 report up to 4.31m) And if you were to chart these values only, the chart would probably look pretty good for the present month, but it would also belie the situation in the trenches. Home sales
Highest Existing Home Sales in a Year
As is the case with a majority of housing and mortgage market data these days, the Existing Home Sales data from NAR is heavily dependent on context. To be sure, the headline is true. You'd have to go back to report that came out in February, 2024 to see a higher annual pace of sales. (NOTE: the table above contains initially-reported numbers. NAR subsequently revised the 3/31/24 report up to 4.31m) And if you were to chart these values only, the chart would probably look pretty good for the present month, but it would also belie the situation in the trenches. Home sales
21st March, 25
Refi Demand Remains Elevated, But Off Recent Highs
The Mortgage Bankers Association conducts a weekly survey on the level of mortgage applications, both for purchases and refinances. Both data series continue to be a tale of two decidedly different eras for the mortgage market. If we focus on the present era, for a moment, refi demand continued to enjoy a relative boom thanks to rates that remain much lower than they had been several weeks ago. The most recent levels were logically a bit lower as the average lender's rates were a bit higher this time around. If you were overcome with indignation at seeing someone refer to
Refi Demand Remains Elevated, But Off Recent Highs
The Mortgage Bankers Association conducts a weekly survey on the level of mortgage applications, both for purchases and refinances. Both data series continue to be a tale of two decidedly different eras for the mortgage market. If we focus on the present era, for a moment, refi demand continued to enjoy a relative boom thanks to rates that remain much lower than they had been several weeks ago. The most recent levels were logically a bit lower as the average lender's rates were a bit higher this time around. If you were overcome with indignation at seeing someone refer to
21st March, 25
Builders Broke More Ground Than Expected in February
The Census Bureau released its New Residential Construction report this week, frequently referred to by its principal component "housing starts" (a term for the start of the first phase of new home construction, aka "breaking ground"). In addition to housing starts, the data also logs building permits as well as completions. As we often note, building permits are more even-keeled while housing starts and completions can experience much more month-to-month volatility. February was the latest example of that as permits came in right in line with forecasts while housing starts surged higher
Builders Broke More Ground Than Expected in February
The Census Bureau released its New Residential Construction report this week, frequently referred to by its principal component "housing starts" (a term for the start of the first phase of new home construction, aka "breaking ground"). In addition to housing starts, the data also logs building permits as well as completions. As we often note, building permits are more even-keeled while housing starts and completions can experience much more month-to-month volatility. February was the latest example of that as permits came in right in line with forecasts while housing starts surged higher
21st March, 25
Builder Confidence Hits 7 Month Low in March
The National Association of Homebuilders/Wells Fargo Housing Market Index (aka "builder confidence") hasn't been in a purgatory of sorts, ever since the big interest rate spike in the 2nd half of 2022. Builders aren't nearly as downbeat as they were during the Great Financial Crisis years, but nowhere remotely as confident as the during the post-pandemic highs. The index has now spent more than 2 years muddling sideways in an increasingly narrow range. The latest reading, reported this week, was worse than economists were expecting, largely due to a bigger decrease in buyer traffic
Builder Confidence Hits 7 Month Low in March
The National Association of Homebuilders/Wells Fargo Housing Market Index (aka "builder confidence") hasn't been in a purgatory of sorts, ever since the big interest rate spike in the 2nd half of 2022. Builders aren't nearly as downbeat as they were during the Great Financial Crisis years, but nowhere remotely as confident as the during the post-pandemic highs. The index has now spent more than 2 years muddling sideways in an increasingly narrow range. The latest reading, reported this week, was worse than economists were expecting, largely due to a bigger decrease in buyer traffic
21st March, 25
Mortgage Rates Tick Gently Higher to End Week
In terms of the market movement that underlies and dictates mortgage rate movement, today looked a lot like yesterday. Things started strong and faded gently as the day progressed. There were no notable economic reports or news events apart from a White House press conference where Trump said there will be "flexibility on tariffs." Tariffs have generally been a depressant for financial markets, acting to push stock prices lower and--at times--increasing demand for bonds (which, in turn, helps rates move lower). With that in mind, when we've seen headlines that suggest a
Mortgage Rates Tick Gently Higher to End Week
In terms of the market movement that underlies and dictates mortgage rate movement, today looked a lot like yesterday. Things started strong and faded gently as the day progressed. There were no notable economic reports or news events apart from a White House press conference where Trump said there will be "flexibility on tariffs." Tariffs have generally been a depressant for financial markets, acting to push stock prices lower and--at times--increasing demand for bonds (which, in turn, helps rates move lower). With that in mind, when we've seen headlines that suggest a
21st March, 25
AI-Powered Lending, Day 1 Certainty; Corresp. Product Tools; FOMC Balance Sheet Reduction
“Elon is firing Twitter employees with bad posture. I have a hunch I might be next.” If I have a sprained finger, I don’t need a heart and lung transplant. And if I did need a transplant, I wouldn’t want a florist doing it. For years, the CFPB has been accused of a “shoot first, ask questions later” mentality, taking drastic action when less would have been more helpful. Earlier this week new FHFA Director Bill Pulte fired several board members of Freddie and Fannie (including Mike Heid whom many of us know), and installed, among others, Christopher Stanley, X employee and a “
AI-Powered Lending, Day 1 Certainty; Corresp. Product Tools; FOMC Balance Sheet Reduction
“Elon is firing Twitter employees with bad posture. I have a hunch I might be next.” If I have a sprained finger, I don’t need a heart and lung transplant. And if I did need a transplant, I wouldn’t want a florist doing it. For years, the CFPB has been accused of a “shoot first, ask questions later” mentality, taking drastic action when less would have been more helpful. Earlier this week new FHFA Director Bill Pulte fired several board members of Freddie and Fannie (including Mike Heid whom many of us know), and installed, among others, Christopher Stanley, X employee and a “
21st March, 25
Post-Fed Trade Turning Out As Expected
Heading into this week's Fed announcement, we noted the consolidation pattern in bonds (the convergence of intraday highs and lows in an increasingly narrow range). After the favorable reaction to the Fed, the highest probability outcome was that the consolidation would shift gears into more of a sideways range, and that's exactly what we're seeing so far. The underlying rationale is that, without big ticket data or major unforeseen shocks, bonds lack sufficient motivation to challenge recent highs or lows. Waiting game... The shift from consolidation pattern to range trade is
Post-Fed Trade Turning Out As Expected
Heading into this week's Fed announcement, we noted the consolidation pattern in bonds (the convergence of intraday highs and lows in an increasingly narrow range). After the favorable reaction to the Fed, the highest probability outcome was that the consolidation would shift gears into more of a sideways range, and that's exactly what we're seeing so far. The underlying rationale is that, without big ticket data or major unforeseen shocks, bonds lack sufficient motivation to challenge recent highs or lows. Waiting game... The shift from consolidation pattern to range trade is
20th March, 25
Uneventful Trading Day, But That's a Win
Uneventful Trading Day, But That's a Win There's not much to say about today's trading session. MBS and Treasuries both ended exactly in line with yesterday's latest levels, and there wasn't much fanfare in between. Well, maybe "fanfare" depends on one's perspective. 10yr yields managed to fall 6bps by 9:30am and pushed 6bps higher over the next 3.5 hours before flat-lining in the afternoon. A 6bp swing is somewhat interesting, but even if we only had the flat-line, today would still be a victory due to yesterday's gains and the fact that bonds haven't been bothered by the
Uneventful Trading Day, But That's a Win
Uneventful Trading Day, But That's a Win There's not much to say about today's trading session. MBS and Treasuries both ended exactly in line with yesterday's latest levels, and there wasn't much fanfare in between. Well, maybe "fanfare" depends on one's perspective. 10yr yields managed to fall 6bps by 9:30am and pushed 6bps higher over the next 3.5 hours before flat-lining in the afternoon. A 6bp swing is somewhat interesting, but even if we only had the flat-line, today would still be a victory due to yesterday's gains and the fact that bonds haven't been bothered by the
20th March, 25
Mortgage Rates Very Close to Multi-Month Lows
It was actually a rather uneventful day for the bond market. That means it should have been an uneventful day for mortgage rates (because they're driven by changes in the bond market). To be fair, it was far from an exciting day, but the average mortgage lender was nonetheless able to inch closer to potentially exciting milestone. Rates have generally been flat at levels that are just a bit higher compared to the longer-term low seen in early March. Before that, you'd have to go back to mid-October to see anything lower. Today's mortgage rates ended up 0.05% lower than yesterday's
Mortgage Rates Very Close to Multi-Month Lows
It was actually a rather uneventful day for the bond market. That means it should have been an uneventful day for mortgage rates (because they're driven by changes in the bond market). To be fair, it was far from an exciting day, but the average mortgage lender was nonetheless able to inch closer to potentially exciting milestone. Rates have generally been flat at levels that are just a bit higher compared to the longer-term low seen in early March. Before that, you'd have to go back to mid-October to see anything lower. Today's mortgage rates ended up 0.05% lower than yesterday's
