Good afternoon and Happy Friday. Below is your Market Update, written each Friday personally by myself for you to keep on top of the local real estate and mortgage markets. 🙂 From The Desk of Tom Santos.
Interest Rates and Mortgage Bonds (Interest Rates flat week-over-week)- Mortgage bonds rallied this week, which would usually be great news for interest rates. The 10 year note, as of writing this article – 4.999%. As you can see, it has dropped dramatically and is a hair below 5%, a psychological barrier. Many suggest this maybe the markets looking past inflation, Iran, Ukraine, a nasty election cycle, higher rates, and a wet-winter – to a potential slowing in the overall economy? Interest rates should have dropped dramatically, but they really haven’t moved. As of right now, Mortgage News Daily has the average 30 year fixed conventional nationally – 7.33% (Last Friday was 7.37%). A little disheartening, but at least they stopped jumping. CMEFedWatch Tool has a 90.60% chance of interest rates remaining neutral and a 9.40% chance of a .25% increase at the October 28, 2026 Meeting.
Real Estate Locally – Of course, the rain and wind caused some additional slow-down + the increases the last couple months in interest rates + inflation/politics/geo-politics = all are creating a potential perfect storm for a slowing thru Fall and Winter. We will take it week by week. I floated open-houses last weekend, business and walk-in’s are still happening. At a lesser frequency, but still happening. And what is weird, one can be dead and another can be average traffic. But as of now, there is a pretty solid slowing trend heading into the holidays. Many will tell you, it could be time to pounce, writing offers that work for you, and asking for large seller concessions for interest rate buy-downs or 2/1 buydowns? That is what I am hearing.
Outside Influences on R/E and mortgage markets – Of course the normal things like Inflation, oil, gas, diesel, Iran, Ukraine – all have a little to say about Consumer Sentiment. The Economic Reports released this week were pretty muted or poor. 1) Pending Homes Sales, per NAR – Home sales were down 7.3% this past month and down 11.30% yoy. That was a pretty big number. 2) Mortgage Apps – Have slowed to 1996 levels, even slower than 2008/2009 economic crisis period. 3) Stock markets got beat up a bit, due to either slowing or a profitability questioning in the AI Sector?
Mortgage News – Thru an Executive Order, The White House ordered Director Pulte to release the “Decreasing Housing Costs for the American People.” This starts by 1) Seeking more methods to quickly remove mortgage insurance from current mortgages in the system, that meet the requirements vs waiting for consumers to signal. 2) Ordered Secretaries of the VA and USDA to drop interest rates down in VA and USDA – to make those more affordable than other open-market interest rates. 3) Introducing renewing Title Insurance for refinances. 4) It didn’t cover appraisals or LLPA’s – so it may have a couple parts to it? At this point, we will take any assistance we can get.
Enjoy your weekend, hope you found this report helpful, and I am around for any questions. Take care.
