Mortgage rates rise following a surge in Treasury yields

Key Takeaways:

– Mortgage rates rose due to an increase in the yield on the 10-year Treasury note
– Average 30-year fixed rate for conventional loans increased to 7.16%
– 15-year fixed rate also saw an increase
– Market preparing for upcoming economic data reports
– Inventory of single-family homes on the market is increasing
– More inventory can lead to more sales, but may also indicate weakening demand
– Homebuyers waiting for lower rates may face increased competition in the future

HousingWire:

Mortgage rates rose this week as the yield on the benchmark 10-year Treasury note inched up. As of Monday, the yield on the 10-year U.S. Treasury note was about 4.25%, according to Tradeweb, up from 3.86% at the end of last year. 

As a result, HousingWire’s Mortgage Rates Center showed the average 30-year fixed rate for conventional loans at 7.16% on Tuesday, up from 7.07% one week earlier. At the same time one year ago, the 30-year fixed rate averaged 6.53%. Meanwhile, the 15-year fixed rate averaged 6.51% on Tuesday, up from 6.5% one week earlier.

“The 10-year yield is up a few basis points this week as the market gets ready to digest the next big piece of economic data: Friday’s PCE inflation report. As the 10-year yield moves higher, mortgage pricing should move with it, but the mortgage spreads are having a good week, which is encouraging news,” HousingWire lead analyst Logan Mohtashami said.

“The following week, we have jobs week with four economic labor reports for the bond market to focus on.”

As of March 22, there were 513,000 single-family homes unsold on the market, up 1.1% from the week prior and up 24% from the same week one year ago. At the same period last year, inventory was declining, according to Mike Simonsen, founder and president of Altos Research.

“We’ll finish the year with over 600,000 homes on the market unless rates reverse and fall quickly,” Simonsen wrote on Monday

More inventory on the market means that more sales can take place. But, on the other hand, it can also mean that demand is weakening.

“The longer mortgage rates stay higher, the more inventory will grow closer to the old levels,” Simonsen wrote. “If you’re a homebuyer and you’re waiting for mortgage rates to fall before you swoop in for a deal, recognize that even slightly lower rates will spur demand more than supply so inventory will start falling and selection and competition will be worse.”

Source link

Property Chomp’s Take:

Have you been keeping an eye on mortgage rates lately? Well, if not, let me fill you in on the latest news. Mortgage rates have been on the rise this week due to the increase in the yield on the benchmark 10-year Treasury note. As of Monday, the yield on the 10-year U.S. Treasury note was at about 4.25%, up from 3.86% at the end of last year.

So, what does this mean for potential homebuyers or those looking to refinance? Well, according to HousingWire’s Mortgage Rates Center, the average 30-year fixed rate for conventional loans was at 7.16% on Tuesday, up from 7.07% the previous week. A year ago, the 30-year fixed rate averaged 6.53%. Similarly, the 15-year fixed rate saw an increase, averaging 6.51% on Tuesday, up from 6.5% the week before.

HousingWire lead analyst Logan Mohtashami commented on the situation, stating, “The 10-year yield is up a few basis points this week as the market gets ready to digest the next big piece of economic data: Friday’s PCE inflation report. As the 10-year yield moves higher, mortgage pricing should move with it, but the mortgage spreads are having a good week, which is encouraging news.”

As of March 22, there were 513,000 single-family homes unsold on the market, up 1.1% from the previous week and 24% from the same time last year. This increase in inventory could mean more sales opportunities, but it could also signify weakening demand.

Founder and president of Altos Research, Mike Simonsen, noted, “We’ll finish the year with over 600,000 homes on the market unless rates reverse and fall quickly.” He also warned potential homebuyers that waiting for mortgage rates to drop before making a move may not be the best strategy, as even a slight decrease in rates could spur increased demand, leading to a decrease in inventory and potentially more competition in the market.

So, if you’ve been considering buying a home or refinancing, it may be worth keeping an eye on mortgage rates and acting sooner rather than later. Who knows, the market could shift quickly, and you don’t want to miss out on a good deal.