Better News Again With Home Sales Pushing Rates Higher

Mortgage rates are continuing to increase as existing home sales came in much higher than expected by the National Association of Realtors. That means more demand for homes and mortgages and more money in the economy. The 10-year Treasury note, which is the best market indicator of where mortgage rates are going, is approaching 3.0% and investors are closely monitoring the situation. We could see mortgage rates move higher if this event unfolds today so it’s important to stay informed on what’s happening.

Where Are Mortgage Rates Going?                     

>>> Rates are still moving up, but not as fast as seen in the past week

Financial market participants are continuing to keep their eye on the 10-year Treasury note yield as it sits just below the key psychological threshold of 3.0%, at 2.99%. At this point, it seems like only a matter of time before it nudges up one more basis point (although yesterday it did manage to endlessly linger close where it is now).

While there has certainly been quite a fuss made over this event, there is still a debate over what it will actually mean as we move forward through 2018. The dichotomy is on clear display when you compare information that is coming from various news sources that the 10-year Treasury yield is knocking on the doorstep of the 3.00% level, of which when crossed could cause shock waves in the financial markets. 

There has been talk that some investors fear that when it does hit this mark - something that has not happened since 2014 – it would mean that higher rates are here to stay. That turns into less spending money for companies and individuals, potentially causing a downturn for the U.S. economy. The other side of the coin is that 3.0% is just a number and is it much different than where we are now?  In all, we do not see any serious repercussions to the market. Of course, no one knows for certain what will happen – but it will happen.

It is important for anyone looking to buy a home or refinance their current mortgage to follow along with the market as these events unfold because the yield on the 10-year Treasury note is the main market indicator of where mortgage rates are going.

Rate/Float Recommendation           

>>> Lock now before rates move higher

Mortgage rates are once again pushing higher on positive economic news and a shrinking concern over a trade war or military escalation overseas. Look for rates to tick a bit higher today on relatively moderate volatility.

If you want to avoid the risk of locking in after this happens, you should lock in your rate now. Despite what happens in the near-term, mortgage rates are still expected to move higher in the long run so locking in a rate sooner rather than later remains the smart decision for most borrowers. If you have any further questions, give us a call or visit our website at Call The Money Man.