Buyers pulled the 10-year Treasury yield from a 24-year high of 5.34% to a 5.233% close on Thursday, after its biggest quarterly rise since 1994. Part of that demand was a flight to safety, and part was a bet that the Fed holds off on further hikes.
Perspective Coverage
3 publishers
- Builder
- Builder 0%
- Operator
- Operator 8%
- Investor
- Investor 92%
Reality
- Evidence58
- Adoption
- Insufficient
- Hype gap+15
- Incentives
- Insufficient
- Confidence60
Freddie Mac's benchmark 30-year mortgage rate rose to 7.28% this week, a sixth straight weekly increase and the highest since November 2023. Since February it has risen as far as the 10-year Treasury yield, so the cost of a move this fall depends on the bond market's inflation outlook.
Reality
- Evidence74
- Adoption
- Insufficient
- Hype gap−5
- Incentives
- Insufficient
- Confidence78
US existing-home sales fell 2 per cent in August to a 3.98 million annual pace while listings rose to 1.62 million homes, the most since November 2019, and the ratio of the two is about 4.9 months of supply.
Perspective Coverage
3 publishers
- Builder
- Builder 10%
- Operator
- Operator 37%
- Investor
- Investor 53%
Reality
- Evidence78
- Adoption
- Insufficient
- Hype gap+15
- Incentives40
- Confidence72
The daily 30-year fixed reached 7.24% last week. Applications feeding Q4 closings are down far more than signed contracts, and the buyers still transacting are increasingly cash buyers.
Reality
- Evidence64
- Adoption70
- Hype gap+15
- Incentives66
- Confidence58
The bank's researchers say the scores Fannie Mae and Freddie Mac generate inside automated underwriting predict 90-plus-day delinquency at 24 months better than the measures pulled at application. Investors mostly see them in securities disclosures.
Reality
- Evidence52
- Adoption42
- Hype gap+15
- Incentives62
- Confidence55
William Pulte directed Fannie Mae to copy Freddie Mac and let servicers phone borrowers whose homes have appreciated. KBW's Bose George expects modest uptake and says the released capital goes to buybacks.
Reality
- Evidence62
- Adoption25
- Hype gap+35
- Incentives72
- Confidence58
A Pew study puts that band at 22.3% of originations in 2024, while scores of 700 and above gained 24.9 points over the same period. Existing home sales are now running at a 3.98 million annual pace.
Reality
- Evidence64
- Adoption70
- Hype gap+15
- Incentives58
- Confidence62
The 30-year mortgage sits 41 basis points above where it was last September, existing home sales have fallen three months running, and August's monthly inflation stepped back up to 0.4%. Housing-exposed plans need a new base case.
Reality
- Evidence66
- Adoption68
- Hype gap+18
- Incentives45
- Confidence58
A 6.71% mortgage sits 1.97 points above the 10-year Treasury, the same gap as before January's buyback fanfare, which means a 6% handle now needs a 4.03% ten-year that the market has not offered since mid-2023.
Reality
- Evidence58
- Adoption52
- Hype gap+12
- Incentives35
- Confidence55
The final rule's treatment of private mortgage insurance sets the risk weight on a segment that is 40% of purchase originations. The relief case compares net severity against gross.
Reality
- Evidence32
- Adoption34
- Hype gap+34
- Incentives82
- Confidence38
The 30-year fixed rate slipped two basis points to 6.65%, its second straight weekly decline. It is still seven basis points above where it sat a year ago.
Reality
- Evidence32
- Adoption
- Insufficient
- Hype gap+28
- Incentives55
- Confidence38
Pending home sales fell 2.3% in July to the second-lowest reading on record, and the West hit an outright record low. A fourth year at the bottom is not a cycle you wait out.
Reality
- Evidence82
- Adoption76
- Hype gap+12
- Incentives40
- Confidence74