|10 year government bond yield||0.68%|
|30 year fixed rate mortgage||2.94%|
Stocks are higher this morning on no real news. Bonds and MBS are flat.
Quicken’s crosstown rival United Wholesale is going public via one of those Special Acquisition Corporations (SPACs). The deal will value the company at $16 billion. When do we get to rebrand The Motor City as the Mortgage City?
Existing home sales rose 2.4% MOM to 6 million, according to NAR. They were up 10% YOY, and the median home price rose 11% to $310,600.
“Home sales continue to amaze, and there are plenty of buyers in the pipeline ready to enter the market,” said Lawrence Yun, NAR’s chief economist. “Further gains in sales are likely for the remainder of the year, with mortgage rates hovering around 3% and with continued job recovery.”
Total housing inventory sits at 1.49 million units, or about 3 month’s worth of inventory. Historically, 6.5 months worth was considered a balanced market. In addition to the dearth of inventory, NAR believes that remote work will be a growing feature of the US economy, even after a COVID vaccine is found. You can see below we are pretty much in record territory as far as housing supply goes.
Mortgage Applications rose 7% last week as purchases rose 3% and refis rose 9%. “Mortgage applications activity remained strong last week, even as the 30-year fixed-rate mortgage and 15-year fixed-rate mortgage increased to their highest levels since late August,” said Joel Kan, MBA Associate Vice President of Economic and Industry Forecasting. “Purchase applications were up over 25 percent from a year ago, and the demand for higher-balance loans pushed the average purchase loan size to another record high.”
Rocket’s big announcement (which it has been hyping for weeks now) is the rebranding of its broker business from Quicken Loans Mortgage Services to Rocket Pro TPO. It will allow for e-signature technology, better visibility into loan status and allow borrowers to upload documents electronically.
“We have two pieces of technology that brokers love: One is ‘The Guru,’ and it’s kind of a Google platform for mortgage guidelines – searchable. Brokers love it,” Niemiec said in an interview. “We also have ‘The Answer,’ which is a piece of technology that brokers can interact with to ask questions and it communicates back and forth leading them to the proper answer. We actually partnered with Google over the last few months to create a new piece of technology that merges everything they love about Guru and everything they love about Answer into one tool called Pathfinder by Rocket. We’ll be rolling that out on the day of the announcement.”
Home prices rose 1% in July and are up 6.5% YOY, according to the FHFA House Price Index.
“U.S. house prices posted a strong increase in July,” said Dr. Lynn Fisher, FHFA’s Deputy Director of the Division of Research and Statistics. “Between May and July 2020, national prices increased by over 2 percent, which represents the largest two-month price increase observed since the start of
the index in 1991. The dramatic increase in prices this summer can be attributed to the historically low interest rate environment and rebounding housing demand even as the supply of homes for sale remains constrained.”