{"id":758,"date":"2022-08-09T11:34:47","date_gmt":"2022-08-09T18:34:47","guid":{"rendered":"http:\/\/www.ezmortgages.us\/?p=758"},"modified":"2022-08-11T11:44:17","modified_gmt":"2022-08-11T18:44:17","slug":"ez-mortgage-monitor-august-9-2022","status":"publish","type":"post","link":"https:\/\/ezmortgages.us\/ez-mortgage-monitor-august-9-2022\/","title":{"rendered":"EZ Mortgage Monitor – August 9, 2022"},"content":{"rendered":"

\u201cIt\u2019s tough to make predictions, especially about the future\u201d \u2013 Yogi Berra<\/p>\n

Have mortgage rates peaked for this cycle?<\/p>\n

Maybe.\u00a0 Nobody really knows.\u00a0 But, it does feel that way, to me.\u00a0 From a high of almost 6% at the end of June, we saw rates move back to the mid 4%s for 30yr fixed loans w\/ no points, up through Thursday August 4th, until that blockbuster jobs report.\u00a0 They then pulled back slightly.<\/p>\n

Nevertheless, I still think rates may have peaked for this cycle.\u00a0 Having said that, I\u2019ve been wrong a lot more than usual in this unusual year, so you can take my opinions with a grain of salt, just like anyone else\u2019s.<\/p>\n

In my defense, I\u2019ve said for years, eventually rates will rise and catch me, and probably most people, by surprise.\u00a0 Well?\u00a0 Surprise!\u00a0 That\u2019s exactly what happened.<\/p>\n

So where do we go from here?\u00a0 This is where we\u2019ve been:<\/p>\n

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It\u2019s hard to see the recent peak in this 51 year view, so here\u2019s the last twelve months:<\/p>\n

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As the saying goes, past performance is not indicative of future results.\u00a0 So as I said at the top, who knows where things will go from here?<\/p>\n

Either way, it is nice to see what appears, at least for now, as a top in the mortgage rate cycle, since many prognosticators were calling for 30yr fixed rates to be pushing 7% sometime this year.\u00a0 Could they?\u00a0 Sure.\u00a0 Will they?\u00a0 We\u2019ll find out.<\/p>\n

We have to remember that the Federal Reserve doesn\u2019t control mortgage rates.\u00a0 They control the Federal Funds Rate, which is an overnight lending rate (ie: very short term).<\/p>\n

Mortgage rates are driven by investors, and what they\u2019re willing to accept for their return on investment.\u00a0 Granted, for the last 2+ years (or even long if we go all the way back to 2009 with the first round of Quantitative Easing) the Fed has been the biggest buyer of mortgage backed securities.\u00a0 And, they\u2019re currently allowing those purchases to roll off their books.\u00a0 But, there appears to be enough demand to soak up the extra supply.<\/p>\n

For now, that high point for 30 yr fixed mortgage rates around 6% isn\u2019t something we\u2019ve seen a lot of over the last last decade.\u00a0 Whether we\u2019ll see it again, remains to be seen.<\/p>\n

Either way, here are my thoughts on why that roughly 6% 30yr fixed mortgage rate may prove to have been the peak in this cycle:<\/p>\n