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17th January, 25
Slightly Weaker Drift, But Broadly Uneventful
Slightly Weaker Drift, But Broadly Uneventful Friday may as well have been a 4th weekend day for the bond market. Volume and liquidity were obviously in holiday mode. Trading levels were basically flat, although it might not feel that way if you're seeing MBS prices end the day down more than an eighth of a point. It's unclear whether we're seeing actual weakness at the end of the day or an incidental expression of extremely thin liquidity. Even if it's "real," it's still not bad considering where we were on Tuesday afternoon. Econ Data / Events Building Permits 1
Slightly Weaker Drift, But Broadly Uneventful
Slightly Weaker Drift, But Broadly Uneventful Friday may as well have been a 4th weekend day for the bond market. Volume and liquidity were obviously in holiday mode. Trading levels were basically flat, although it might not feel that way if you're seeing MBS prices end the day down more than an eighth of a point. It's unclear whether we're seeing actual weakness at the end of the day or an incidental expression of extremely thin liquidity. Even if it's "real," it's still not bad considering where we were on Tuesday afternoon. Econ Data / Events Building Permits 1
17th January, 25
Uneventful Day For Mortgage Rates
Mortgage rates are driven by the bond market and Friday was the least active day of the week for bonds. There were no major economic reports to cause rapid changes in trading levels. As such, mortgage rates started out very close to the levels seen yesterday and most lenders didn't make any mid-day changes. The absence of any significant movement is a victory, of sorts, in light of the ground covered over the past 2 days (the best 2-day improvement since November). On the other hand, rates began the week at the highest levels since May 2024. It's more common to see bigger gains when
Uneventful Day For Mortgage Rates
Mortgage rates are driven by the bond market and Friday was the least active day of the week for bonds. There were no major economic reports to cause rapid changes in trading levels. As such, mortgage rates started out very close to the levels seen yesterday and most lenders didn't make any mid-day changes. The absence of any significant movement is a victory, of sorts, in light of the ground covered over the past 2 days (the best 2-day improvement since November). On the other hand, rates began the week at the highest levels since May 2024. It's more common to see bigger gains when
17th January, 25
Homebuilder Confidence Consolidation Continues
While it would be technically accurate to point out a slight increase in January's homebuilder confidence (officially the National Association of Homebuilders Housing Market Index or HMI ), the type of movement we've seen in the past 2 years is better characterized as "incidental" in the bigger picture. As with most housing-related metrics, HMI plummeted in 2022 as interest rates skyrocketed. It's been broadly sideways ever since with the swings between highs and lows getting smaller and smaller. In market jargon, this is a textbook example of "consolidation"--something that can signal
Homebuilder Confidence Consolidation Continues
While it would be technically accurate to point out a slight increase in January's homebuilder confidence (officially the National Association of Homebuilders Housing Market Index or HMI ), the type of movement we've seen in the past 2 years is better characterized as "incidental" in the bigger picture. As with most housing-related metrics, HMI plummeted in 2022 as interest rates skyrocketed. It's been broadly sideways ever since with the swings between highs and lows getting smaller and smaller. In market jargon, this is a textbook example of "consolidation"--something that can signal
17th January, 25
Housing Construction Bounced Back in December Thanks to Multifamily Sector
The US Census Bureau released its New Residential Construction report for December today. The report measures building permits, the start of the construction process (housing starts), and housing completions. While construction has definitely been running well below the highs seen 3 years ago, it continues to operate just above pre-pandemic levels. That's something that can't be said for many other housing and mortgage market metrics. Last month's data showed housing starts closer to the low end of 2024's range. Today's report shows a bounce back to the highest levels since
Housing Construction Bounced Back in December Thanks to Multifamily Sector
The US Census Bureau released its New Residential Construction report for December today. The report measures building permits, the start of the construction process (housing starts), and housing completions. While construction has definitely been running well below the highs seen 3 years ago, it continues to operate just above pre-pandemic levels. That's something that can't be said for many other housing and mortgage market metrics. Last month's data showed housing starts closer to the low end of 2024's range. Today's report shows a bounce back to the highest levels since
17th January, 25
AMC Alternative, Verification, Realtor Fee Financing Tools; Letter to FHFA Director
We’re more than halfway through January already, the MBA has lowered its 2025 projection to $2.1 trillion, and there is a sense of “wait and see” out there among lenders and vendors regarding rates, products, regulations… Maybe you should do something besides just making a few extra calls. STRATMOR’s current blog is “Leaders Don’t Wait for Markets” which may give you some tips. In 2023, 12 percent of Americans changed residences (leaving states like CA, FL, and NY), a statistic not lost on top LOs and real estate agents. Elon Musk has the luxury of being geographically mobile,
AMC Alternative, Verification, Realtor Fee Financing Tools; Letter to FHFA Director
We’re more than halfway through January already, the MBA has lowered its 2025 projection to $2.1 trillion, and there is a sense of “wait and see” out there among lenders and vendors regarding rates, products, regulations… Maybe you should do something besides just making a few extra calls. STRATMOR’s current blog is “Leaders Don’t Wait for Markets” which may give you some tips. In 2023, 12 percent of Americans changed residences (leaving states like CA, FL, and NY), a statistic not lost on top LOs and real estate agents. Elon Musk has the luxury of being geographically mobile,
17th January, 25
Pre-3 Day Weekend Volatility is a Thing
It always bears repeating that "predictions are for suckers" and if there were a hard and fast rule about what markets do in certain scenarios, traders could take advantage of those probabilities, thus restoring the odds to a more neutral level. With that disclaimer aside, in scenarios where rates rally fairly sharply on Wed/Thu with motivation from data/events, and when there is no major data on Friday, and when it is a 3 day holiday weekend, we'd wager that 6 out of 10 traders would expect a bit of a pull-back. In the first few hours of domestic trading, we're not seeing a major
Pre-3 Day Weekend Volatility is a Thing
It always bears repeating that "predictions are for suckers" and if there were a hard and fast rule about what markets do in certain scenarios, traders could take advantage of those probabilities, thus restoring the odds to a more neutral level. With that disclaimer aside, in scenarios where rates rally fairly sharply on Wed/Thu with motivation from data/events, and when there is no major data on Friday, and when it is a 3 day holiday weekend, we'd wager that 6 out of 10 traders would expect a bit of a pull-back. In the first few hours of domestic trading, we're not seeing a major
16th January, 25
2 Straight Days of Gains?!
2 Straight Days of Gains?! Not only have bonds managed to pull off a feat rarely seen in recent memory (back to back days of solid gains), but the total drop in yields is the biggest since August 2024. Today's improvement wasn't nearly as big as yesterday's CPI-driven rally, but it would have been very strange if it had been. The data and events on tap didn't have the street cred to drive such craziness. Modestly weaker retail sales helped yields level off after overnight weakness, but comments from Fed's Waller and Treasury Secretary nominee Bessent accounted for most of the
2 Straight Days of Gains?!
2 Straight Days of Gains?! Not only have bonds managed to pull off a feat rarely seen in recent memory (back to back days of solid gains), but the total drop in yields is the biggest since August 2024. Today's improvement wasn't nearly as big as yesterday's CPI-driven rally, but it would have been very strange if it had been. The data and events on tap didn't have the street cred to drive such craziness. Modestly weaker retail sales helped yields level off after overnight weakness, but comments from Fed's Waller and Treasury Secretary nominee Bessent accounted for most of the
16th January, 25
Mortgage Rates Back Down to Lowest Levels in 2 Weeks
After having a great day yesterday, mortgage rates were able to add another "good" day today. The net effect brings the average lender's top tier 30yr fixed rate back down to levels last seen on January 2nd, exactly 2 weeks ago. Yesterday's key motivation was the palatable inflation data in the Consumer Price Index (CPI). Today's economic data wasn't nearly as pertinent to the outcome although a slightly softer reading on Retail Sales didn't hurt this morning. Rather, it was comments from a member of the Federal Reserve (Waller) and the Treasury Secretary nominee
Mortgage Rates Back Down to Lowest Levels in 2 Weeks
After having a great day yesterday, mortgage rates were able to add another "good" day today. The net effect brings the average lender's top tier 30yr fixed rate back down to levels last seen on January 2nd, exactly 2 weeks ago. Yesterday's key motivation was the palatable inflation data in the Consumer Price Index (CPI). Today's economic data wasn't nearly as pertinent to the outcome although a slightly softer reading on Retail Sales didn't hurt this morning. Rather, it was comments from a member of the Federal Reserve (Waller) and the Treasury Secretary nominee
16th January, 25
Settlement, Warehouse, Servicing Transfer Tools; Training and Webinars; Rates React to Inflation Data
Do you know the interest rate on your loan? How about the age of your roof? Here in Austin, a big concern is too much growth: Austin has gained 1 million people in the last 15 years. Sprawl, traffic, and new construction have become the name of the game. As well as mounting property tax and insurance costs. Insurance agents and companies seem to be controlling homeowners, remodeling, landscaping, and…roofing. Property and climate risk platform ZestyAI conducted a 27,000-property advanced AI and aerial imagery survey on roof age, which found a surprisingly high proportion of properties have
Settlement, Warehouse, Servicing Transfer Tools; Training and Webinars; Rates React to Inflation Data
Do you know the interest rate on your loan? How about the age of your roof? Here in Austin, a big concern is too much growth: Austin has gained 1 million people in the last 15 years. Sprawl, traffic, and new construction have become the name of the game. As well as mounting property tax and insurance costs. Insurance agents and companies seem to be controlling homeowners, remodeling, landscaping, and…roofing. Property and climate risk platform ZestyAI conducted a 27,000-property advanced AI and aerial imagery survey on roof age, which found a surprisingly high proportion of properties have
16th January, 25
Pushing Into Stronger Territory With Help From Data, Fed, and Maybe More
While it was never going to be on the same level as yesterday's CPI in terms of market movement potential, Retail Sales was likely to be today's most relevant data. The early price action confirmed that. Jobless Claims and Philly Fed were stronger than expected. Retail Sales was the only report that was weaker, and that's the way bonds chose to trade it, moving to erase some of the overnight losses. Next up were comments from Fed's Waller on the prospect for 2025 rate cuts and further inflation progress. This kicked the rally into higher gear, bringing bonds well into
Pushing Into Stronger Territory With Help From Data, Fed, and Maybe More
While it was never going to be on the same level as yesterday's CPI in terms of market movement potential, Retail Sales was likely to be today's most relevant data. The early price action confirmed that. Jobless Claims and Philly Fed were stronger than expected. Retail Sales was the only report that was weaker, and that's the way bonds chose to trade it, moving to erase some of the overnight losses. Next up were comments from Fed's Waller on the prospect for 2025 rate cuts and further inflation progress. This kicked the rally into higher gear, bringing bonds well into
