Your Guide to the Housing and Mortgage Markets; The Martini Factor (September 6 – September 11, 2022 Economic Update)

September 6, 2022 by Kevin Martini

The Martini Factor is curated by Certified Mortgage Advisor and Raleigh Mortgage Broker Kevin Martini to provide a glimpse of what is likely to impact Raleigh mortgage rates this week.

The top 2 items likely to impact Raleigh mortgage rates this week

ONGOING SPECULATION REGARDING FED RATE HIKES LATER THIS MONTH

Financial markets in the U.S. reopened Tuesday after a long holiday weekend, with mortgage bonds kicking off the week sharply lower in negative territory. Bond investors preparing for ongoing aggressive rate hikes at the Federal Reserve monetary policy meeting later this month. The jobs report came out relatively strong last week, showing continued strength in the economy. This paves the way for more Fed rate hikes.

3.7% is the current unemployment rate in the U.S.

RENEWED INFLATION FEARS DUE TO RISING ENERGY PRICES

It became apparent over the weekend that energy prices are likely to remain elevated due to supply constraints. Specifically, Russia’s biggest natural gas pipeline to Europe will not resume pumping as expected. This means Europe is facing its worst gas supply crisis ever. There is even talk of rationing as the winter months approach. This is sparking renewed fears about rising inflation and an economic slowdown.

Oh by the way…

It is never too early to start to explore your homeownership options and you are not too late either. The first part of the homeownership journey is the loan and then after you have the certainty and being armed with price and cost clarity, the second step is to go find your home. The Martini Mortgage Group offers trusted advice with a frictionless digital mortgage process that provides certainty. To contact Mortgage Strategist with the Martini Mortgage Group simply call: (919) 238-4934.

Your Guide to the Housing and Mortgage Markets; The Martini Factor (August 29 – September 5, 2022 Economic Update)

August 29, 2022 by Kevin Martini

The Martini Factor is curated by Certified Mortgage Advisor and Raleigh Mortgage Broker Kevin Martini to provide a glimpse of what is likely to impact Raleigh mortgage rates this week.

The top 2 items likely to impact Raleigh mortgage rates this week

The ongoing market reactions to Powell’s speech last week.

Federal Reserve Chairman Jerome Powell gave a speech last Friday(August 26, 2022) at the annual Jackson Hole Economic Symposium indicating his very hawkish view and that the Fed’s fight against inflation is likely to cause pain throughout the economy. He also indicated that rate hikes will continue until inflation subsides. Stocks plunged on Friday, and mortgage bonds opened this week sharply lower. In fact, bond yields are at their highest levels since 2007. This indicates that mortgage pricing will likely worsen this week, as bond investors continue to process this news.

The Economic Reports this week.

This week’s economic calendar is quite full. The crescendo will be Friday’s always-important jobs report. The jobs report came out much stronger than market expectations last month, and investors are expecting the job numbers to cool a bit this month. It will be interesting to see whether that happens, and how the market will react. In the meantime, the JOLTS Job openings report is scheduled for release on Tuesday, along with the Consumer Confidence report. Any of these reports could trigger a market reaction.

Oh by the way…

The MartiniFactor | last week and this week with real estate and mortgage rates | May 6, 2022

May 2, 2022 by Kevin Martini

The MartiniFactor is produced by Raleigh Mortgage Broker Kevin Martini and it provides a glimpse of what happened last week in real estate and in the mortgage arena. In addition, it shares thoughts on what to keep on the radar for the week ahead in the mortgage markets.

Last week (4/29/2022) & this week (5/6/2022)

LAST WEEK IN THE REAL ESTATE & MORTAGE MARKETS

CoreLogic released their Single-Family Rent Index this week and it showed that rents were up 13.1% Year-over-Year in February. Clearly now it is not the time to rent however it may be the time to explore the opportunity to invest and create a real estate portfolio.

Gross Domestic Product (GDP) illuminated that growth was down 1.4%. This decline is a potential sign of a recession but remember, sometimes you can be in and out of a recession before you even know it since, first quarter GDP will be revised 2-times and the final number is not inked until June 2022. Remember, a recession is two consecutive quarters of a downward shift of economic data hence, we won’t know until Fall of 2022 if a recession is happening or ha happened.

The Federal Reserves favorite measure of inflation is the Personal Consumption Expenditures (PCE). PCE indicated last week that inflation rose 0.9% in March and that was much higher than what was expected. The Core rate, which takes out food and energy was up 0.3%. Yes, inflation remains at a 40-year high!

THIS WEEK IN THE MORTGAGE MARKETS

Economic News Calendar

Monday – 5/2/22

ISM Manufacturing

Construction Spending

Tuesday – 5/3/22

Reserve Bank of Australia

Factory Orders

JOLTS (Job Openings & Labor Turnover Survey)

Wednesday – 5/4/22

ADP Private Payroll

Trade Balance

ISM Non-Manufacturing

Fed Interest Rate Decision

Fed Chair Powell Speaks

Thursday – 5/5/22

Bank of England

Challenger Job Cuts

Initial Jobless Claims

Nonfarm Productivity

Unit Labor Costs

Friday- 5/6/22

Nonfarm Paytolls

Average Hourly Earnings (month-over-month)

Average Hourly Earnings (year-over-year)

Average Weekly Hours

Unemployment Rate

This week home loan rates may significantly be impacted by the wealth of important economic news. ADP Private Payrolls and the Jobs Reports will be released plus the Federal Reserve’s Interest Rate decision. It is the opinion of the Martini Mortgage Group, the Federal Reserve will hike 0.5% however the real story for Raleigh mortgage rates is what will the Federal Reserve do with their balance sheet which includes mortgage bonds.

The Federal Reserve increasing the Federal Funds Rate has no significant impact on Raleigh mortgage rates. Credit card rates, Home Equity Lines of Credit (HELOC) and car loans, for example, are based on the Prime Rate and the Prime Rate is based on the Federal Funds Rate. So a hike of the Federal Funds Rate will no impact Raleigh home loan rates. However, $2.9 trillion is the number of mortgage bonds purchased by the Federal Reserve since March 2020. The reduction of the Federal Reserves holdings of these mortgage bonds could drive up Raleigh home loan rates.

The Federal Reserve is expected to reverse course and start selling its massive, 2.9 trillion of bonds as early as June. When that happens, other central banks across the world may follow suit. This means the already-stressed bond market may be in for a massive deluge of supply in the coming months, which could put more upward pressure on interest rates. Wednesday’s announcement from the Federal Reserve is so important to the bond market, and why mortgage rates may be impacted.

THE MARTINI MORTGAGE GROUP BOTTOM LINE

Be prepared for more volatility and remember, right now, real estate and the current mortgage rate environment remains an opportunity. From a historical perspective, home loan rates are still very low even with the upward movement in 2022. Mortgage Strategists with the Martini Mortgage Group are here to talk about what you have just read and available to help you on the path to buying you home. Contact the Martini Mortgage Group by dialing (919) 238-4934.

Kevin Martini

Logan Martini