Issue 40. August 28th, 2023

Happy Monday💸 Rates recoiled after the blood bath last week. Still not anywhere near where we want them, but a whole lot better than the 8% nightmare we were staring at lol.

There will be NO newsletter on Monday the 4th (Next Monday). I am headed out of town for a Fantasy Football draft. Yes, we dedicate an entire weekend and have people fly in from out of town.

For those of you interested in such things, this is a 12-man, PPR, live auction draft. So, fun as all hell. The wives are psyched every year we bring it up (not!).

If the past 13 years of this league are any indicator, I can confirm right now that I will be in no shape to spend thoughtful brain cells composing this newsletter.

#HappyDraftWeekend

Have a wonderful week.

– Glenn T. Groves

TLDR (Too Long Didn’t Read) Summary:

• ⬇️ RATES – Rebound From Last Week

  Verify my mortgage eligibility (Oct 3rd, 2023)

• 📊 TECHNICALS – Fed Has Hawkish Comments

• 🌟 INSPIRATION – Failing Forward

RATES

Product Rate / APR Weekly Change

⬇️ Conventional (Zero Point) 7.375% / 7.341% -.125%

Conventional (One Point) 6.950% / 7.065%

⬇️ Conv. HB (Zero Point) 7.625% / 7.635% -.375%

Conv. HB (One Point) 7.250% / 7.368%

↔️ JUMBO (Zero Point) 7.625% / 7.636% +.000%

JUMBO (One Point) 7.125% / 7.245%

⬇️ FHA 3.5% Down (Zero Point) 6.625% / 7.357% –.375%

FHA 3.5% Down (One Point) 6.250% / 7.086%

⬇️ VA 0% Down (Zero Point) 6.750% / 6.997% –.375%

VA 0% Down (One Point) 6.375% / 6.723%

Rate data as of morning of publication. Unless noted otherwise, all scenarios are assuming 30 Year Fixed mortgage, Purchase & R/T Refinance. No origination points charged, 780 FICO score, and 20% down payment .Provided for consumer education only and does not serve as a binding offer to extend lending. Payment period, interest rate, APR, and other terms subject to income, asset, and credit profile qualification.

Rates highlighted in this color have the same metrics as above, but would incur one discount point charge.

• 📊 Mortgage Rates: Nice little rebound after the absolutely terrible start to last week.

  Verify my mortgage eligibility (Oct 3rd, 2023)

TECHNICALS

A Little Better, A Lot of The Same

Married With Children

📊 Are Further Fed Rate Hikes Ahead?

The Scoop: Jerome Powell, the Fed Chair, gave us some pretty hawkish signals (tighter policy + higher rates) at the annual Jackson Hole Symposium. He’s saying that more rate hikes could be on the horizon.

What It Means for Agents:

• If rates go up, borrowing becomes more expensive for buyers 📈
• A higher rate environment could cool down buyer enthusiasm 😬
• Keep an eye on upcoming labor data; it's something the Fed will be watching before deciding on
  future rate hikes 🕵️‍♂️

🏡 Existing Home Sales Constrained by Low Inventory

The Scoop: Existing Home Sales are down, thanks to the low inventory crisis. We’re at a 4.07-million-unit annualized pace as of July, a significant dip from last year.

What It Means for Agents:

• Be prepared for bidding wars on the few available properties 🤼‍♀️
• Consider focusing on new listings to keep your pipeline full 🆕
• Use this scarcity to your advantage when dealing with prospective sellers
  💡

🏗️ New Home Sales Reach 17-Month High

The Scoop: New Home Sales are up, reaching a 714,000-unit annualized pace. That’s the highest we’ve seen since February of last year!

What It Means for Agents:

• Great news for those focusing on new builds 🎉
• The median sales price for new homes is $436,700 - knowledge is power when setting client expectations 💰
• Consider leveraging this data to attract more buyers interested in new
  construction 🏠

📉 Tame Unemployment Claims

The Scoop: Jobless claims are down, with 230,000 new filings. It looks like the labor market is stabilizing.

What It Means for Agents:

• A stable job market generally equals confident buyers 🛒
• However, the Fed is eyeing this data closely for their rate decision on September 20. Circle that date 🗓️

📅 What to Look for This Week

Expect new data on home price appreciation and job market trends. Keep an eye out for these updates as they can influence buyer and seller decisions.

• Case-Shiller Home Price Index and FHFA House Price Index out on Tuesday 📊
• July’s Pending Home Sales on Wednesday 🏡
• August’s Jobs Report on Friday 📉

10Y T Note 08.28.2023

📊 Expanded Technical Picture: Mortgage Bonds & Rates

Let’s dig deeper into the technicals of the market, particularly focusing on Mortgage Bonds and what they could mean for us.

The Current Landscape

Mortgage Bonds ended last week in a wide range, trading between a floor at 97.313 and overhead resistance at the 25-day Moving Average. The 10-year yield is also showing considerable volatility, bouncing between 4.335% and its own 25-day Moving Average (above).

What It Means for Agents

• Wide Range = Potential Whipsaws: In trading, a “whipsaw” refers to a situation where a security’s price heads in one direction but then quickly reverses, causing losses or missed opportunities. With bonds in a wide range, expect rates to be a bit jittery.🎢

• 10-Year Yield: Keep an eye on this. If it pushes past its ceiling of 4.335%, we could see an uptick in mortgage rates. This is crucial for setting expectations with your clients.👀

  Verify my mortgage eligibility (Oct 3rd, 2023)

• Economic Data: The bond market is very sensitive to economic news. With employment data and other economic indicators coming up, the bonds could react, leading to rate changes. Mark your calendars for the August Jobs Report this Friday and Fed’s next meeting on September 20th.🗓️

How to Use This Information

1. Be Proactive: If rates are low, encourage prospective buyers to lock in their rates before they climb.⏳

2. Educate Your Clients: Let them know what these numbers mean for their buying power and, consequently, their budget.💡

   Verify my mortgage eligibility (Oct 3rd, 2023)

3. Seller’s Timing: If a rate hike is anticipated, it might motivate sellers to list now rather than later, anticipating a potential decrease in buyer pool size.🏡

And there you have it, folks! Keep this info in your back pocket as you navigate through showings, listings, and client meetings this week. Let’s conquer the real estate world together! 🌍🏡

Do you have any questions or need clarification on any of these points? Feel free to drop a comment or reach out.

INSPIRATION

Wise Words

“I’ve missed more than 9,000 shots in my career. I’ve lost almost 300 games. 26 times I’ve been trusted to take the game-winning shot and missed. I’ve failed over and over and over again in my life. And that is why I succeed.” – Michael Jordon.

This market is not fun. Keep pushing. Keep failing forward, and you will succeed team!

Happy house hunting! 🏠💼🎉

Created by Glenn Groves

Loan Scenario Question?

• Email the team: TeamGlenn@gtgfi.com

  Verify my mortgage eligibility (Oct 3rd, 2023)

Options For Your Clients

• Schedule Call: 1 on 1 with Glenn

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