A special video Rate Update

Given the extraordinary circumstances we are currently experiencing I have prepared a special video ‘rate update’ for today. 

Please take 4 minutes to watch this special message below:


Current Outlook: Floating

Mortgage rates at all time lows. Might they go even lower?

Home Loan Rates

Mortgage rates are presently at all-time lows which were originally established in 2012 and again in 2016.  Could home loan rates go even lower?

The Coronavirus

Although new cases of the Coronavirus are slowing in China the number of people infected in other countries is growing.  Furthermore, there is fear that some countries are underreporting the true number of citizens infected with the virus.

Fear over the spread of the illness is now having a significant impact on financial markets around the globe.

Impact on Financial Markets

On Monday US & European stock markets fell by ~3% and today they are off over 1%.  Japan’s stock market fell 3.3% on Monday.

When stocks decline it tends to drive capital into the bond market which pushes interest rates lower.  The US 10-year treasury note is now trading at 1.322%, an all-time low) and the yield curve is now inverted.

An article published by Bloomberg reported that unless economic activity resumes 66% of small to medium sized businesses inside China are poised to run out of cash within two months.

Home Prices

According to the S&P CoreLogic Case-Shiller Home Price Index appreciation picked up nationwide at the end of 2019.  The report showed that homes increased by 3.8% during 2019.

With interest rates hitting all-time lows I expect home price appreciation will remain healthy for the foreseeable future.

The week ahead

There is plenty of significant economic data being reported this week.   Specifically, I will be paying attention to New Home Sales (Wednesday), Gross Domestic Product (Thursday), Pending Home Sales (Thursday), and Personal Income (Friday).

However, news regarding the Coronavirus is the primary driver of interest rates at this moment.  If it appears that the illness continues to spread then I expect stocks to continue to falter and mortgage rates to improve further.

Current Outlook: Floating

Rate Update October 8, 2010

Mortgage rates are at all-time lows this morning.

This morning’s monthly jobs report showed that overall the economy lost 95,000 jobs last month which was much worse than expected.  However, private sector job growth came in just below expectations.  The Bureau of Labor Statistics also revised lower previous month’s jobs figures leading the markets to believe the employment picture may be worse than thought.

The disappointing report makes it more likely tat the Fed will engage in further quantitative easing to help stimulate the economy.

We shifted to a floating bias yesterday and we’ll remain with this approach.

Current outlook: floating