Mortgage Market Update

July 9, 2009 · Posted in News For Homebuyers

So what is happening in today’s market? A couple of things:

The stock market seems to be gaining back some of what it lost yesterday.
The bad day in the stock market yesterday spiked some modest improvement in mortgage rates today.
Today (and tomorrow) there are BIG (billions) in Treasury auctions and they are the longer term ones.

How those auctions go will have a potentially market moving impact on mortgage rates. Which way? A couple of thoughts:

If the foreign governments continue to buy Treasuries, we could see the markets relax and some slight dropping of mortgage rates.
If there is any likelihood that the markets are being stirred up by the talk at the G-8 Summit about a different reserve currency or a slowdown in government buying of our debt, we could see a spike upward.

I’m currently placing about a 60/40 odds on the second option rather than the first and therefore I’m recommending locking rather than floating.

I’ll write more as the events transpire.