‘Tis the season for the unexpected, it seems. Lenders are buzzing about potential new loan limits, news outlets are reporting lower rates that are actually higher, and rumors of a refi boom swirl around, though not entirely accurate.
Rates:
Rates are on the move, trending slightly higher while still hovering near long-term lows. The 10yr Treasury yields chart reflects positive momentum in recent months, with a slight correction after the Fed rate cut last week. Mortgage rates, on the other hand, seem to have dropped according to Freddie Mac’s survey this week, but reality tells a different story. Even with discrepancies, the overall trend points to manageable rates.
Loan Limits and Home Prices:
Some lenders are jumping the gun with new conforming loan limits reaching $800k or more, ahead of the official announcement in November. By analyzing the FHFA house price index, it’s evident that lenders are making calculated guesses based on available data. Recent trends show cooling price appreciation, hinting at a new conforming loan limit of $800,950. While some lenders may overshoot, they are likely to align with the official numbers soon.
Refi Boom:
The question of a refi boom remains uncertain. While there has been a notable surge in refinance activity, it’s merely a rebound from previously low levels. With many homeowners already enjoying low mortgage rates, further incentives for refinancing are limited. Economic data from the week was unremarkable, with a focus on the labor market and upcoming Employment Situation report potentially influencing rates in the near future.
In conclusion, the lending landscape is rife with speculation and anticipation. Stay informed, keep an eye on market trends, and be prepared to adapt to changing conditions in the financial realm.
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