Jordan Keck covers mortgage rates rising to 7.16%, a VA policy shift allowing buyers to pay agent commissions starting June 12, and Fed Governor Waller's signal that rate cuts could come with higher unemployment or sustained low inflation. Attached home rents fell 0.6% year-over-year for the first time in 14 years, while existing home sales dropped 1.9% in April despite inventory rising 9% month-over-month.
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Good morning and happy Friday. Jordan Cake here, your lender buddy, with your weekly market update. And quick reminder as well, this coming Monday is Memorial Day. So just want to just be grateful for those who have given everything in defense of our country, providing the freedoms that we have here. As those who may not know, on Veterans Day is obviously to celebrate those who are veterans, whereas Memorial Day is to really reflect on those who have given everything while in service to this country. So I want to thank all of the families out there who have other family members who are in that spot. So again, just very, very grateful. And hopefully you get a chance to enjoy and spend some time with gratitude this weekend. As far as interest rates go, moving into the market, up a little bit from 7.02% last week to 7.16% this week. Weekly mortgage tip I wanted to talk through has to do with rate quotes. You know, a lot of times, obviously, we quote the interest rates, we're looking at averages in this market update, 7.02%, 7.16%. And that's something that I think can get a little bit confusing at times, because that's not what people are going to be getting. That's an average of lenders across the entire country for scenarios in top tier. So 25% down or more, 800 credit score, conventional loan purchase. And so all of those criteria have to be the case in order to get that specific one. And again, that's the average, some are going to be higher, some are going to be lower. And so while it may be tempting to be able to provide those rates to people, I just ask that you at least caveat it and not tell your clients that's the rate that they're going to get. Because FHA, VA, USDA loans, those typically are going to have lower interest rates. And then conventional, everybody gets to choose what rate they want based on how much they want to buy down, or maybe they don't want a lower rate because they want lower closing costs. And so in that scenario, you know, manufactured home, condo, down payment, all of that, you know, credit score can impact that specific interest rate. And so it may provide some unrealistic or some false expectations, good or bad, if we're quoting that that's the interest rate that people will be getting, as opposed to looking at it as an indicator for where the market for interest rates is going. So with great power comes great responsibility. Just want to make sure that, you know, when you're talking about interest rates, the rates that I talk about and the rates you'll see online, those are indicators for where the market's going, not rates we should be quoting that individual people will be getting. Next up here, the great news you may have already heard about, but With the NAR settlement situation, one of the big concerns is that the VA had this ban not allowing buyers to pay for their buyer agent commission. And there were a few caveats around, you know, we create ways we could potentially get around that. But good news is that VA has finally came out after months of pressure from NAR, saying that they will lift that ban from buyers not being able to pay their buyer's agent commission. And this will go into effect with the VA circular June 12th, saying they will allow buyers to pay their buyer agent commission while doing a VA transaction. So great news, great win for the industry there. This circular will go into effect again June 12th until more permanent language is written. Next up, Fed talk. Fed Governor Waller confirms unemployment is the key to lower interest rates. He confirmed that in the absence of a weakening labor market, they would need to see several months of good inflation data before supporting rate cuts. So we really got two different options here, one of them being higher unemployment rates, another being good inflation numbers. So it seems like we're getting at least a little head nod that if one of those two things is happening, we could look at some rate cut potential there for him. Next up, Target announced over 5,000 items that they are going to be doing price cuts on to be able to help fight some of the competition they're getting from other retailers such as Walmart. Now, this is a move which may help to lower some of those inflation numbers we were just talking about from such a large retailer, and maybe giving a nod to the industry as well that others might start to follow suit. Prices haven't really been going anywhere but up for several years now, but again, hopefully helping to push inflation down a little bit with that. CoreLogic's rental report for March showed detached home rents were up 3.5% year over year. Interestingly, attached rental prices have actually declined 0.6% year over year, which is the first negative reading in 14 years. This may speak to the additional rental supply that's been coming online after, you know, during COVID and shortly after, we saw a lot of the multifamily construction really pick up where single-family had dropped off. And as that's starting to come online for rental properties here, you know, multifamily apartment units, That may be speaking to— with the additional supply comes a decreasing in that rent increase, because again, it all comes down to supply and demand. Now we're seeing extra supply outpacing some of that demand. And lastly here, existing home sales fell 1.9% for April, slightly below expectations. There was also a slight revision higher for March, which makes the headline number look higher than it would have been without that revision. Revision. Inventory did increase 9% month over month, and is now up 16% year over year to a 3.5-month national supply. The average days on market though actually dropped during that. So we're down from 33 days on market on average down to 26. So even though we're getting more inventory, homes are still moving very, very quickly, which is great news for the market. Because as we've talked about, typically the biggest restraining factor that we've had in the last several years has in inventory. The more inventory and selection we get, typically the more sales we're going to see. And then lastly, I touched on a little bit last week, looking at not just a beginner's Texas Hold'em class where we're going to be having a great night of playing. So if you've ever been interested in learning to play Texas Hold'em, gonna have a table for that. The same night, we're also going to be doing at least 2 tables for those who have played before, that more experienced and want to be able to have a great time. So if you're interested in either learning to play or joining a group that knows how to play for Texas Hold'em, let me know. Dates to be determined, but should have something by next week settled for the end of June. So if you're interested in getting an invite to that or any ongoing poker nights that I host, let me know. The last couple we've had have been a really phenomenal time. Looking for a low cost to entry, probably somewhere between $20 and $30. And really, that's just so that there's a good pot to be able to shoot for, but not so much you're going to miss out on losing that money, but just have a really great time with some phenomenal people. So again, if you're interested in that, let me know. I'll get you on the invite list for when we have a date settled for that at the end of June. Again, hope you have a fantastic weekend. If you need anything, let me know. I'm here for you as always. Have a great time. I'll see you next week.
