{"id":16,"date":"2005-11-24T07:05:00","date_gmt":"2005-11-24T14:05:00","guid":{"rendered":"http:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/?p=16"},"modified":"2005-11-24T07:05:00","modified_gmt":"2005-11-24T14:05:00","slug":"digging-for-the-news-on-interest-rates","status":"publish","type":"post","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/16\/digging-for-the-news-on-interest-rates\/","title":{"rendered":"Digging for the news on interest rates"},"content":{"rendered":"

Note this from the Arizona Republic<\/a>:<\/p>\n

Mortgage rates around the country, which have been trending upward, dropped this week, offering a dose of good news for prospective home buyers.<\/p>\n

Mortgage giant Freddie Mac reported Wednesday in its weekly survey that rates on 30-year, fixed-rate mortgages averaged 6.28 percent. That’s down sharply from last week’s rate of 6.37 percent, which was the highest in more than two years.<\/p><\/blockquote>\n

Newspapers are all about bad news reported on the shortest possible range of vision, so I suppose we should rejoice that the paper actually took note of some good short-term news. But the news of interest rates–and of real estate in general–is always about the long-term. The news of securities issues might matter day-to-day, but nobody buys a house one day and sells it the next.<\/p>\n

So: What’s the real news on interest rates?<\/p>\n

Take a look at this graph:<\/p>\n

<\/p>\n

All of these charts come from BankRate.com. What we’re looking at is the average rates for a 30-year fixed rate amortizing mortgage from Arizona lenders over the last 30 days. We hover between 5.70% and 5.96%, and the recent trend is decidedly downward. Good news, huh? Maybe not:<\/p>\n

<\/p>\n

That’s the three-month trend for a 30-tear fixed. The real<\/i> trend is fairly steadily upward, right? But wait. There’s more:<\/p>\n

<\/p>\n

The same loan product over the last year. Down. Then up. Then back down. Then up a little. Then down a little. Then way<\/i> up. Could it be that the sky really is<\/i> falling?<\/p>\n

<\/p>\n

Phew! The three-year trend looks like a Drunkard’s Walk, a random stochastic hovering right around 5.40%. Interestingly, the trend seems to be flattening. But: If you read anything into that, you’re making an error. Mortgage rates aren’t caused by trends, trends are a coincidental artifact of changes in rates.<\/p>\n

But here’s the real<\/i> news:<\/p>\n

<\/p>\n

That’s the five-year history of 30-year fixed rate mortgages in Arizona. Does that look like bad news to you? Does it look like bad news is lurking just around the corner, poised to strike?<\/p>\n

Things can change. Disasters can befall us. Governments can inflict grievous errors on the national or international economy. But for now, at least, there is an Read more<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Note this from the Arizona Republic: Mortgage rates around the country, which have been trending upward, dropped this week, offering a dose of good news for prospective home buyers. Mortgage giant Freddie Mac reported Wednesday in its weekly survey that rates on 30-year, fixed-rate mortgages averaged 6.28 percent. That’s down sharply from last week’s rate […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_crdt_document":"","jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[2],"tags":[],"class_list":{"0":"post-16","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"hentry","6":"category-general","8":"no-featured-image"},"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack-related-posts":[{"id":5071,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/5071\/mortgage-market-week-in-review-12\/","url_meta":{"origin":16,"position":0},"title":"Mortgage Market Week in Review","author":"Tom Vanderwell","date":"October 17, 2008","format":false,"excerpt":"Well, here we are and it\u2019s time for another Mortgage Market Week in Review.\u00a0\u00a0 This week, we\u2019re going to talk about consumer spending, consumer confidence, the new normal, where\u2019s the bottom?\u00a0and why interest rates have had a 1 percent up and half percent down swing since last week Wednesday. Consumer\u2026","rel":"","context":"In "Real Estate"","block_context":{"text":"Real Estate","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/real-estate\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":2529,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/2529\/amaze-your-friends-why-the-surprise-fed-funds-rate-drop-isnt-impacting-mortgage-rates\/","url_meta":{"origin":16,"position":1},"title":"Amaze Your Friends : Why The “Surprise” Fed Funds Rate Drop Isn’t Impacting Mortgage Rates","author":"Dan Green","date":"January 22, 2008","format":false,"excerpt":"Advanced Fiscal Literacy For Real Estate Professionals The Fed Funds Rate is a fair proxy for economic health.\u00a0 When the economy is growing, the FFR\u00a0rises to fight inflation. When the economy is slowing, the FFR\u00a0falls to fight \"the absence of inflation\" (i.e recession). If inflation is the enemy of mortgage\u2026","rel":"","context":"In "Lending"","block_context":{"text":"Lending","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/lending\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":2796,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/2796\/will-the-fed-buy-mortgage-backed-securities-in-the-open-market\/","url_meta":{"origin":16,"position":2},"title":"Will the Fed Buy Mortgage Backed Securities In the Open Market?","author":"Brian Brady","date":"March 18, 2008","format":false,"excerpt":"I never post my Mortgage Rates Reports here.\u00a0 They're boring unless you are thinking about buying a home or refinancing your mortgage.\u00a0 Today, it seems plausible that the Fed is shifting its open market activities from buying treasuries, to buying mortgage-backed securities, in order to bolster liquidity in the mortgage\u2026","rel":"","context":"In "Lending"","block_context":{"text":"Lending","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/lending\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":761,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/761\/why-the-fed-matters-to-real-estate\/","url_meta":{"origin":16,"position":3},"title":"Why The Fed Matters to Real Estate","author":"Dan Green","date":"December 12, 2006","format":false,"excerpt":"The Federal Open Market Committee meets today and will keep the Fed Funds Rate unchanged at 5.250%. It is not what the Fed does, however, that should concern Americans. It's what the Fed says. First, a clarification. The Fed Funds Rate is directly tied to Prime rate which impacts lines\u2026","rel":"","context":"In "Enduring Interest"","block_context":{"text":"Enduring Interest","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/enduring-interest\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":1889,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/1889\/arms-look-scary-before-they-look-good-or-how-wall-street-dupes-the-little-guy\/","url_meta":{"origin":16,"position":4},"title":"ARMs Look Scary Before They Look Good or (How Wall Street Dupes the Little Guy)","author":"Brian Brady","date":"September 4, 2007","format":false,"excerpt":"I don't look real smart today, do I ? Mortgage rates in general took a fairly substantial dive during the previous week with longer term rates dropping double digits in most cases and some rates returning to mid-2006 levels. However, the Mortgage Bankers Association reported a spectacular increase in the\u2026","rel":"","context":"In "Investment"","block_context":{"text":"Investment","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/investment\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":2663,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/2663\/once-more-with-feeling-mortgage-rates-are-determined-by-mortgage-bonds-mbs-not-the-ten-year-t-note\/","url_meta":{"origin":16,"position":5},"title":"Once More With Feeling- Mortgage Rates Are Determined by Mortgage Bonds (MBS), Not The Ten Year T-Note","author":"Brian Brady","date":"February 26, 2008","format":false,"excerpt":"Mortgage rates are volatile today...very volatile.\u00a0 There are two underlying factors contributing to the volatility: suspicion of the credit quality of the MBS market and supply\/demand imbalance (more people want money than is offered). Why am I so adamant about the fact that the ten-year treasury note is not the\u2026","rel":"","context":"In "Lending"","block_context":{"text":"Lending","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/lending\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]}],"_links":{"self":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/posts\/16","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/comments?post=16"}],"version-history":[{"count":0,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/posts\/16\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/media?parent=16"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/categories?post=16"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/tags?post=16"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}