Weekly Update October 17, 2018

Rates, rates, rates!  Another volatile week in the mortgage markets and every day seems to be a new surprise!  However, if we sift through the noise, it becomes clear that the Fed is making it quite clear that “normalizing” rates will be advantageous in the long run.  Significant market shifts might indicate otherwise, but the reality is that the market is doing well enough (in whole) to justify less accommodative monetary policy.  So look past the massive swings in both the bond and stock markets and focus on what is actually going on.  Week over week, rates are generally flat or slightly down.  However, throughout the week we saw drastic improvements followed by a day of giving it all back.  Net effect… flat.  Week over week flat markets do NOT tell the whole story so please make sure you are working with a mortgage professional who knows the market.  It can make the difference between your clients buying their dream home and it remaining just a dream.

The Fed Meeting Minutes reiterated what we already knew.  The days of accommodative monetary policies seem to be behind us and the focus seems to be focused on keeping the market in check.  So rates are not as low as they once were.  Is that bad?  Probably not.  Rates are still incredibly low from a historical standpoint and the housing market in the Front Range might benefit from some “normalcy.”  10-25% Year over Year value increases is simply not sustainable and could potentially harm our local housing markets.  We promote long term, sustainable growth for the benefit of both buyers and sellers.  Mountain State Financial Group is a strong supporter of healthy housing markets which sometimes feels uncomfortable.  However, we are also exceptionally strong supporters of our local real estate professionals to assure we all grow together the right way.

That being said, we are supporting locking rates in the near term as volatility can often mean the difference between qualifying and not qualifying.  As always, If you have any specific questions or scenarios you would like to discuss, I am always happy to help!