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Mortgage News Daily

Posted To: MBS Commentary

Last week brought the pain. It was the worst single week for the bond market (if we count MBS) since 2013. Although this week won't break any records, it was a refreshing change of pace, with almost every day seeing decent improvement. Today's gains were the best, but also the most serendipitous. A seemingly insignificant headline about Chinese delegates cancelling a trade meeting with Montana's agricultural bureau sent shockwaves through both sides of the market. Those headlines were flanked by newswires with market-friendly Fed speakers (Clarida and Bullard). Finally, the 3pm CME close brought a friendly imbalance (in our favor) in tradeflows surrounding the monthly options expirations deadline. This is the sort of thing that can help us or hurt us. Today it helped. Next week...(read more)

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9/20/2019 4:15:35 PM

Posted To: Mortgage Rate Watch

What a difference a week makes! At the end of last week, things were pretty grim, with mortgage rates having just seen their worst single week since 2013. The uplifting caveat at the time was that such bouts of nastiness are not that uncommon in the wake of ultra strong performances (such as the entire month of August--the best single month since 2002 if you can believe it!). In other words, last week was a correction to August's impressive strength. With that in mind, this week turned out to be a correction to last week's correction! There was no way to be sure, but we were hoping it was overdone and that bond traders would step in to buy bonds (which pushes rates lower) in response to the big move. That's exactly what happened and it resulted in measured improvements throughout the week....(read more)

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9/20/2019 3:59:00 PM

Posted To: MND NewsWire

Total home equity, not surprisingly, increased again in the second quarter of the year. CoreLogic's quarterly Homeowner Equity Insights report, which looks only at properties with one or more mortgages, puts the aggregate increase at $428 billion year-over-year, a 4.8 percent gain. The company says that 63 percent of residential properties have a mortgage. "Home values have continued to rise in most parts of the country this year and we are seeing the benefit in higher home equity levels. The western half of the U.S. has experienced particularly strong gains in home equity recently," according to CoreLogic CEO and President Frank Martell. In July 2019, South Dakota and Connecticut were the only two states to post annual home price declines. These losses mirror the states' home equity performances...(read more)

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9/20/2019 9:22:11 AM

Posted To: MBS Commentary

In the day just passed, bonds trading was exceptionally calm in the wake of Wednesday's Fed day. As I mentioned in the recap , it was one of the least volatile moves relative to expectations of any Fed day reaction I can remember. The consolidative vibes suggest either indecision or apathy, post-Fed. The clear takeaway from a strategy standpoint is that bonds really and truly are going to be heavily data-dependent in the coming weeks, barring some technical clue that gives away traders' underlying predispositions. In the day ahead, all we can do is keep an eye out for those technical clues and simply bide our time as the bond market does the same. The Fed will be more than willing to cut rates all the way to zero if the econ data justifies the move, but they aren't going to do it...(read more)

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9/20/2019 8:14:11 AM

Posted To: Pipeline Press

A mile is 5,280 feet. And Central Park Tower on West 57th St. in Manhattan now stands at 1,550 feet, about a third of a mile. I mention this because it is now the tallest residential building in the world , and if you’d like to pony up $6.9 million for a unit, now’s your chance. When the builder starts cutting prices, we’ll know that we’re in a slowdown, but until then the press can focus on overseas economies slowing, trade concerns, and persistently weak inflation in the U.S. possibly leading to a U.S. slowdown. Many believe that at some point all this talk of a slowdown or recession in this country will become a self-fulfilling prophecy . It is interesting that President Trump wants the Fed to cut rates to zero, the sign of a stumbling economy which is not what we...(read more)

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9/20/2019 6:36:39 AM

Posted To: MND NewsWire

Thirty-year mortgage loans closed in August carried an average interest rate of 4.07 percent according to Ellie Mae's Origination Insight Report. Rates were down for the eighth consecutive month , easing back from an average of 4.18 percent in July. Ellie Mae said the month-over-month decline in rates continues to drive up the share of originations that are for refinancing. They accounted for 43 percent of all loans closed during the month compared to 38 percent in July. That increase drove purchase originations under a 60 percent share for the first time this year. The refi share popped up by 3 percentage points for all three major loan types. "Interest rates continue to decline and we're seeing homeowners capitalize on the refinance opportunity throughout the month of August," said Jonathan...(read more)

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9/20/2019 6:24:53 AM

Posted To: MBS Commentary

Relative to the expectation for yesterday's Fed events to cause volatility, the movement we've seen in the bond market has been fairly pitiful in response. Seriously folks... I can't think of a bigger gap between they hype and the outcome with respect to Fed days. Today was merely "The Anticlimax: Part 2." In the overnight session, yields respected the exact some highs as the previous overnight session. During domestic hours, bonds rallied just enough to get close to yesterday's best levels before retreating to something almost perfectly between the two. This is a classic, albeit miniature, consolidation pattern. It could signal a measure of equilibrium between buyers and sellers at current levels, but more likely, it's simply a sign of indecision and apathy after...(read more)

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9/19/2019 3:45:40 PM

Posted To: Mortgage Rate Watch

Here is exactly what yesterday's Fed rate cut did to mortgage rates: ABSOLUTELY NOTHING! No Fed rate cut (or hike) will EVER do ANYTHING directly to mortgage rates because the Fed doesn't set mortgage rates. Don't let the caps-lock fool you into thinking I'm some angry guy with a keyboard who's simply ranting for some self-serving purpose. Of all the people you'll talk to today and of all the articles you'll read on this topic, you should trust me the most. I don't say that lightly or very comfortably, for that matter. It sounds terribly cocky, but in this case, it's also terribly honest. For more than a decade, if markets are open and mortgage companies are quoting rates, I've religiously been tracking trends, patterns and plain old boring statistics. I use actual wholesale rate sheets from...(read more)

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9/19/2019 2:23:00 PM

Posted To: MND NewsWire

While the increase wasn't as strong as in July, last month's existing home sales posted a second straight month of gains and, as previously, the National Association of Realtors® (NAR) credited falling interest rates. Sales of previously owned single-family houses, townhouses, condominiums, and cooperative apartments were up 1.3 percent compared to July when sales rose 2.5 percent. The seasonally adjusted annual rate of 5.49 million units was 2.6 percent higher than the August 2018 pace of 5.35 million. The increase was felt in three of the four major regions while the West continues to demonstrate some weakness. The month's results were better than predicted. Analysts polled by Econoday had expected them to come in at an annual rate of 5.30 to 5.42 million with a consensus of 5.38 million...(read more)

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9/19/2019 9:17:04 AM

Posted To: MBS Commentary

In the day just passed, the bond market finally got a chance to sink its teeth into the much-anticipated Fed announcement/forecasts/press conference. Traders were hoping to get a read on whether the Fed rate cut cycle is being treated like a fine-tuning adjustment or the beginning of a sustained shift. Of course there was no way for the Fed to know that, let alone communicate it. As we expected, Powell basically said "it depends." Bonds were a bit let down by that, and the somewhat more hawkish Fed funds forecasts. Yields retreated from their anticipatory lows of roughly 1.75%, but nonetheless managed to stay in positive territory on the day. In the day ahead, bonds will battle with the same 1.75% level after an overnight rally. 1.75% or thereabouts has come into play several times...(read more)

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9/19/2019 7:16:15 AM

Ken Flory, Bennion Deville Homes 760-485-2123 or email: flry7@aol.com  California BRE Lic#01361850


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