April Rate Watch Report

 

Hey team!  Welcome to April 2023! My name is Jeff McGinnis and I am a loan officer with CrossCountry Mortgage. Today, I wanted to discuss what mortgage rates have been doing over the last month and what that means for homebuyers and homeowners.

As you remember in the March Rate Watch rates took a turn for the worse with some fairly meager CPI numbers and a bogus job report.  In the last month, we've seen marked improvement in the bond market and in the treasuries. 

Let’s cut to the charts and take a look.  As you can see we got back most of the ground we lost in February in the month of March in the bonds and we can see the same sort of action happening in the 10 year treasury yield. 

Now as we head into April, we are paying close attention to core CPI, which is our main bellwether for inflation, and that comes out on April 12^th.  Quite frankly, I don’t see much in the way of improvement on those number because March of 2022 had a pretty low inflation number it was .3%. March of 23 will come out on the April release it may be a similar number which won’t do much for our year over year average. 

Bear in mind though we have shelter costs, the costs of renting and or a rental equivalent of a home owned by someone that lives in the property, is lagging behind the actual numbers in the market.  Now shelter costs make up a significant amount of the core CPI at 43%.  Once the shelter costs in CPI start to go down, we’ll see inflation numbers improve substantially.

In the meantime, it would seem the Fed is trying to overshoot inflation.  Remember they said inflation was transitory, in 2021 and turns out it was a little less than transitory.  It was persistent and they showed up a little late to the party.  Ok… fine… not a massive crisis, and they did start doing what needed to be done.  Now they may be staying a little late and perhaps they need a friend to say “you know maaaaaaybeee you should give me the keys and take a little nap here on the couch”  But they’re not they bumped a quarter on the fed funds, but not a half.  So it would be the equivalent of having one last cocktail, but not doing shots at least at this point…we’ll see. 

Do mark your calendars for May 10^th as that is Core CPI that should have some nice impacts on rates. 

Since rates were a little elevated, it is a really good time to be a buyer because a lot of people that would otherwise be in the market trying to buy are sidelined due to fear.  So get out there, make some offers, get your house because it will change!

Jeff McGinnis is a seasoned mortgage lending professional with over 25 years of experience in the industry. He has a proven track record of success and is known as one of the top producers in his field. With a deep understanding of the lending landscape and a passion for helping clients achieve their homeownership goals, Jeff has established himself as a trusted and knowledgeable resource for borrowers. Throughout his career, he has consistently demonstrated his ability to navigate the complexities of mortgage lending, while delivering exceptional customer service and closing loans efficiently. Whether working with first-time homebuyers, veterans, divorcing couples, or seasoned real estate investors, Jeff’s expertise and commitment to his clients has earned him a reputation as a top performer in the industry.