Big Things Happening the Next 3 Days in the Mortgage Market!
This week’s update is a little different. Starting today (8-9-2023) we have 3 influential things happening in the financial realm that have the potential to alter the short term outlook for mortgage rates. The first is that today the Treasury is doing a large 10 year Treasury Note auction, the results of which will be taken as a marker of where we are headed. The second is that on Thursday the CPI (Consumer Price Index) is coming out, and on Friday the PPI. We will have to see, but it is expected that both indexes will show a U turn from the gradual decline in inflation back to a spike up. This is not great news for rates, as reactions to reversals like these, at least in the short term, tends toward over corrections. We’ve all seen gas prices go back through the roof the last week or so. Thanks inflation. It would be unsurprising to see rates hop up a 1/4% or even a 1/2% if the results are as expected.
In other news Americans are back on the revolving debt train. Credit card debt reached a new high of over 1 Trillion dollars, and rates on some of those are running close to 30%. How that is not Usury I have no idea but that won’t help people with qualifying, or peoples budgets. It’s created an interesting dynamic for homeowners who have ended up with large revolving debt balances but a lot of equity in their homes. If you want to access that equity now you really have to run the numbers to see if it makes more sense to do a HELOC or a cash out re-fi. As always, use me as a resource for these and any other real estate related topics.
It’s a good life.
Chris
