This Market Update is written by our Capital Market specialists each week to bring you insight into what's happening in the market and how it may affect mortgage rates and real estate trends.
Market Commentary:
For the week of Sept 15th – Sept 22nd, 30-year and 15-year interest rates increased slightly.
For the week, the major announcement was the FOMC’s decision to keep interest rates the same. The Federal Reserve held interest rates steady, while also indicating it still expects one more hike before the end of the year and fewer cuts than previously indicated next year.
“The economy is nicely balanced at this juncture, and inflation’s momentum is heading downward. There is no need to jeopardize the economy to accelerate that downward momentum,” says George Ball, chairman of Sanders Morris Harris.
In the near term, investors will be watching for the August Core PCE reading on September 29th to confirm inflation is still trending lower heading into the fourth quarter. In addition, the Labor Department will release its September Jobs Report on October 6th, which could shed more light on how much of an impact monetary policy tightening is having on the economy.
Fed Watch: Looking ahead, all eyes are now on the upcoming November 1st Federal Open Market Committee (FOMC) meeting. According to the CME Group, 28.7% of forecasters predict an increase in interest rates, while 71.3% predict rates will remain the same. None of the forecasters expect rates to decrease.
Market Review:
Per Black Knight's Production Metrics, the breakdown of mortgage production volume is as follows: 85.09% for purchase transactions, 12.92% for cash-out refinances, and 1.99% for rate and term refinances.
Per Black Knight 50.24% of all Retail loan production were Government Loans (FHA, VA, USDA), while 49.76% were Conventional and Non-Conforming loans.
News You Can Use
- Fed declines to hike, but points to rates staying higher for longer
- Home sales stick near recent lows in August, but prices continue to climb
- US housing starts hit three-year low; surge in permits point to underlying strength
- Credit card rates are practically in ‘loan shark’ territory as they hit record highs, advisor says
- Home prices are expected to rise in 2024: ‘There are simply not enough homes’ to meet demand, says economist
- New home listings are at their lowest level in years but may see an uptick soon, says Housing Wire
- S. Mortgage Demand Rises Ahead of Fed Decision on Rates
- The Fed May Have Just Stopped Hammering the Housing Market—What That Means for Buyers, Sellers
*Communication is intended for Industry Professionals only and not intended for Consumer Distribution
Interest rate and annual percentage rate (APR) are based on current market conditions as of 09/22/2023, are for informational purposes only, are subject to change without notice and may be subject to pricing add-ons related to property type, loan amount, loan-to-value, credit score and other variables. Estimated closing costs used in the APR calculation are assumed to be paid by the borrower at closing. If the closing costs are financed, the loan, APR and payment amounts will be higher. Contact us for details. Additional loan programs may be available. Accuracy is not guaranteed, and all products may not be available in all borrower's geographical areas and are based on their individual situation. This is not a credit decision or a commitment to lend. actual interest rate, APR, and payment may vary based on the specific terms of the loan selected, verification of information, your credit history, the location and type of property, and other factors as determined by Prosperity Home Mortgage, LLC. Not available in all states. Rate is as of 09/22/2023 and is subject to change at any time without notice. Opinions, estimates, forecasts, and other views contained in this document are those of Freddie Mac's economists and other researchers, do not necessarily represent the views of Freddie Mac or its management, and should not be construed as indicating Freddie Mac's business prospects or expected results. Although the authors attempt to provide reliable, useful information, they do not guarantee that the information or other content in this document is accurate, current, or suitable for any particular purpose. All content is subject to change without notice. All content is provided on an "as is" basis, with no warranties of any kind whatsoever. Information from this document may be used with proper attribution.
