Scottsdale Real Estate Update | September 4th, 2018
05 Sep 2018 by Barbara Woyak
Today’s Mortgage Rate Summary

How Rates Move:
Conventional and Government (FHA and VA) lenders set their rates based on the pricing of Mortgage-Backed Securities (MBS) which are traded in real time, all day in the bond market.  This means rates or loan fees (mortgage pricing) moves throughout the day, being affected by a variety of economic or political events.  When MBS pricing goes up, mortgage rates or pricing generally goes down.  When they fall, mortgage pricing goes up.  Tracking these securities real-time is critical.  For more information about the rate market, contact me directly.  I’m among few mortgage professionals who have access to live trading screens during market hours.
Rates Currently Trending: Higher
Mortgage rates are trending slightly higher so far today.  Last week the MBS market worsened by -16bps.  This may’ve been enought to increase mortgage rates. There was very little mortgage rate volatility last week.
Today’s Rate Forecast: Higher
Three Things: These are the three areas that have the greatest potential to impact mortgage rates this week: 1) Trade War, 2) Jobs and 3) Domestic.
1) Trade War: President Trump has told Congress that it’s o.k. to move ahead with just a Mexico-U.S. agreement, meanwhile Friday’s deadline with Canada has been extended to this week. But the bond market will react the most to any movement on the talks with China.
2) Jobs: Friday’s Jobs data will be key with bonds paying the most attention to wages as the YOY reading is expected to tick up to the 2.8% range.
3) Domestic: Besides Jobs, there is a lot of big economic data with the gravitas to move MBS pricing/mortgage rates. ISM Manufacturing and Non-Manufacturing are the most important
Fed: We will hear from the Fed this week.

  • 09/05 John Williams, Neel Kashkari and Raphael Bostic
  • 09/06 John Williams
  • 09/07 Robert Kaplan, Eric Rosengren and Loretta Mester

Today’s Potential Rate Volatility: Average
Mortgage rate volatility will be highly dependent on the trade negotiations with China and Canada. Markets will also be paying close attention Fed speeches and economic data denoted above.
Bottom Line:
If you are looking for the risks and benefits of locking your interest rate in today, contact your mortgage professional to discuss it with them.
Barbara Woyak

Frustrated by a bad experience, Barbara began her real estate career with a goal of providing exceptional service. Our motto is "A Name Friends Recommend." If you have a great experience then you will want your friends and family to have that same great experience.