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SanFrancisco版 - 太多人做refi,mortgage rate这周变高了
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p**f
发帖数: 3549
1
Coronavirus fallout cut interest rates. So why did mortgages get pricier?
Average fixed-rate mortgage was 3.36% this week, up from a record low 3.29%
a week earlier.
With turmoil in financial markets pushing many key interest rates to record
lows, why are mortgage rates going … higher?
The economic damage from the global coronavirus outbreak has freaked out
financial markets and caused most interest rates to plummet.
However, this week real estate saw a hiccup. What should have been an added
boon to the real estate market, even cheaper mortgages, didn’t materialize.
The “savings” that lenders are potentially reaping from cheaper sources
of money don’t appear to be fully passed along to consumers.
On one hand, it’s hard for a borrower, purchasing a home or refinancing an
old loan, to complain about today’s near record-low rates. The average 30-
year, fixed-rate mortgage was 3.36% this week, up from a record low 3.29% a
week earlier.
Still, I’ll argue they should be cheaper. Look at the key benchmark of
mortgage-making cost, yields on the 10-year U.S. Treasury bond. By one key
measure, it was a stunningly low 0.54% on Thursday, March 12 — almost half
of 0.96% a week ago.
The gap between what lenders are charging and what the bond market is saying
is historically wide. When I put into my trusty spreadsheet a half-century
’s worth of rate data, I found this week’s gap between these two key
interest rates — what’s loosely a big part of mortgage-making profit — at
2.82 percentage points.
How big is that? It’s the largest gap in 12 years. Since 1972 — years that
included numerous periods of double-digit mortgage rates — this gap has
been wider only 4% the time. And over 48 years, this spread between mortgage
rates and Treasury yields has averaged 1.7 percentage points.
So, simply put, if these were average times, my spreadsheet tells me
mortgage rates should be more like 2.24% — or more than a full point below
current quotes.
“Somehow, someway, mortgage rates actually moved higher this week, touching
their highest level in almost a month despite immense volatility in the
markets and Treasury yields falling and remaining near all-time lows,”
wrote Zillow Economist Matthew Speakman. “So, what’s the deal?”
Here’s the bond-market market logic, translated into English as best I can.
Let’s remember that mortgage rates are actually set in large part by big-
dollar institutional investors who buy packages of home loans from lenders.
One of these investors’ biggest risks is not foreclosures. Rather it’s
buying loans that might quickly be refinanced.
Mortgage rates were falling well before anyone knew what coronavirus was and
that drop started a huge wave of refinancings. Please recall that average
home-loan rates were above 4% from early 2018 through May 2019. Recently
rate drops only exploded the urge to refi.
One argument is this recent unusually wide mortgage-to-Treasury gap may be
an attempt by investors to cool the refinancing boom.
Why? When a loan is repaid, the investor does get their money back. But when
rates are down, the investors’ financial pain is that they then must
reinvest at lower yields. So investors’ motivation to get higher rates,
always part of their pricing equation, is amplified.
Or perhaps the wide mortgage-Treasury gap also reflects the huge uncertainty
created by market volatility. Basically, investors don’t want to be “
stuck” owning underpriced loans if a broad chunk of interest rates quickly
reverse and soar higher.
Ponder the last time we saw this large of a gap between mortgage rates and
10-year Treasurys. It was the 2008 financial crisis when investors of all
sorts couldn’t figure out the future. And before that market meltdown, big
gaps were previously found in 2000-2002 during the dot-com bubble-bursting
market turmoil.
Of course, there’s a chance some greed is involved here, too. Consumers may
be happy with the savings created by a new refi, but this pricing gap
suggests the public should being saving even more.
Now, hopefully the mortgage investment market is big enough that if Treasury
rates stay depressed, some investors (and, thus, lenders) will see
opportunity in pushing mortgage rates even lower. That might make this fat
gap history.
But no matter the cause or length of this pricing gap, extraordinary cheap
mortgages should be a powerful boost to the housing market. Well, assuming
house hunters don’t lose jobs or income due to the coronavirus fallout.
Look at these estimates from Meyers Research. In Los Angeles and Orange
counties, the drop from 4% mortgages to 3.25% is equal to a $64,000 price
cut on a home and brings a typical monthly payment back to 2014 levels. In
Riverside and San Bernardino counties, it’s a $31,500 savings, bringing
payments back to 2015 levels.
Imagine if mortgage prices catch up to the current ultra-cheap cost of money
.
B*******l
发帖数: 8
2
Well you can keep an eye on https://getaquote.fyi to monitor when rates are
going down
c******e
发帖数: 82
3
Interest rate won’t go higher before election at least. Why such a hurry?
Especially isn’t home appraisal against SIP now?

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record
added
materialize.

【在 p**f 的大作中提到】
: Coronavirus fallout cut interest rates. So why did mortgages get pricier?
: Average fixed-rate mortgage was 3.36% this week, up from a record low 3.29%
: a week earlier.
: With turmoil in financial markets pushing many key interest rates to record
: lows, why are mortgage rates going … higher?
: The economic damage from the global coronavirus outbreak has freaked out
: financial markets and caused most interest rates to plummet.
: However, this week real estate saw a hiccup. What should have been an added
: boon to the real estate market, even cheaper mortgages, didn’t materialize.
: The “savings” that lenders are potentially reaping from cheaper sources

1 (共1页)
进入SanFrancisco版参与讨论
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问 mortgage rate新年后的mortgage rate怎样了?
Interest Rates Jump to Highest Level in Three Months zz (转载)最近Mortgage Rate涨了好多好多啊
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相关话题的讨论汇总
话题: rates话题: mortgage话题: treasury话题: gap话题: investors