When will rates impact housing?

From HousingWire:

Where are mortgage rates headed?

ast week ended with a wild ride for mortgage rates. We anticipated the two inflation reports could help mortgage rates, however, we had a bad bond auction last Thursday, and the 10-year yield rose sharply. Weekly active inventory grew slowly again and purchase apps were down week to week again.

  • Weekly active listings rose by only 4,270
  • Mortgage rates went from 7.03% to 7.19%
  • Purchase apps were down 3% week to week

Last week we started with lower bond yields as we anticipated inflation reports to continue the trend of slower year-over-year inflation data. This happened as expected, except we had a lousy bond auction, which meant too much debt supply came online with insufficient buyers. This pushed yields higher Thursday and Friday to move mortgage rates to 7.19%.

A valid case for higher mortgage rates in the short term is that we are simply going to be in an environment where we don’t have a lot of bond buyers versus the supply coming in, thus making it harder for mortgage rates to go lower. We saw an example of that last week. 

For my 2023 forecast, my range on the 10-year yield has been between 3.21%-4.25%, emphasizing that the bond yields can go lower than 3.21% only if the labor market breaks. The labor market breaking to me is if jobless claims on a four-week moving average go over 323,000; currently, that data is 231,000. As the economy has stayed firm, bond yields are at a higher level of my range for 2023.

The painful housing inventory story of 2023 continues as we had yet another week of slow inventory growth. Last year when mortgage rates spiked higher, inventory growth was much faster, but we were also working from the lowest levels recorded in history in March of 2022. This year, it’s been a much different story. 

This entry was posted in Demographics, Economics, Housing Bubble, Mortgages, National Real Estate. Bookmark the permalink.

61 Responses to When will rates impact housing?

  1. Hold my beer says:


  2. Fast Eddie says:

    When will rates impact housing?

    When rates hit 10% in the NJ/NY/CT area, the muppets will sacrifice the jet ski purchase to buy the 675K bilevel with gold carpets and avocado appliances. They can be changed but the cabbage and Pall Malls aroma will be a challenge. Though, it won’t really matter because you’ll be telling everyone you bought a house in River Vale or what’s known as “The Vale” for those who live there. Exclusivity has a price.

    Overall, no slowdown around NYC’s gravitational pull. Multiple bids over asking are the norm in “buzz word” towns and will continue to be the case despite nuclear fallout and cockroach infestations. Perhaps when the sun begins its actual sundown in a few billion years is when house prices in our area will begin to noticeably stagnate.

  3. Chicago says:

    Ten 419.1

  4. Chicago says:

    I had to take my son to a running camp up near Monticello. Driving on 17/86 up there is like the Hasid superhighway. Every other car is Toyota Sienna or Honda Odyssey packed with 5-7 people, and an accident every 5 mins. I’m wiped out.

  5. No One says:

    Why is 4.2% on a 10yr bond unbelievable?
    There’s an off chance investors might earn an inflation adjusted positive return on a held to maturity bond for the first time in about 12 years. Looking at the big picture in fixed income history, that seems pretty normal. What’s the historical real yield premium been for owning 10y govt bonds? I thought at least 2% to 3% above inflation. Problem being we don’t know future inflation, and I don’t think the TIPS yields are particularly good predictors of actual future inflation. Maybe this is just a blip in an ongoing period of financial repression though, and within a few years, government bond-holders won’t be allowed to earn real returns again – either through falling yields or rising inflation.

  6. Chicago says:

    Ten 421.1

  7. Fast Eddie says:


    I remember my oldest brother bringing home the album, “The Very Best of Gordon Lightfoot.” I would listen to it every time he was out of the house. Here’s to Gordon Lightfoot, sundowns and Pall Malls.

  8. Chicago says:

    No One: It’s not the level. It is the movement of a massive market from 380, to 408, to 419, to 398, to 408, to 421 in the space of about 15 days. This is supposed to be a benchmark, not a thinly traded stock.

  9. No One says:

    So is now a good time to actually set up some longer term fixed income positions? I’ve been avoiding duration for the past 12 years. For now I get more yield out of government money market funds, but eventually the yield curve will un-invert.
    What’s the yield curve 2 years from now? Back to 0% short 3% long, or a more historically normal curve like 3% short-term , 5% long? Or something else?

  10. Libturd says:


    Was up in Monticello Saturday night for a Sunday Camp drop off with the D. If you weren’t aware, Monticello was the heart of the Borsch Belt. When the Jews from the tri-state became wealthy enough to travel by plane for vacations, the Catskills were kaput. Those fancy resort buildings and Summer Camps were cheap pickens for many Brooklyn and Queens families looking to escape the overcrowded hot city life for a better life in the country. When the resorts all closed, the population that supported them all left. I just read where a school complex was purchased for 180K to open up another yeshiva.

    And you are correct. They all drive beat up old Odysseys and Siennas. They can’t drive because they can’t see, as their vision has all been destroyed by studying the Torah at night, often in the darkness.

  11. Libturd says:

    BRT (from last night),
    In my 21 years of driving my 95 Civic, the only non-routine maintenance repair was also the starter. We are probably on to something.

  12. Fast Eddie says:

    Asking 819K. Gimme your best and final at the open house this Saturday. Prestige has a price. Move to Peoria, Illinois if you can’t afford it. It’s competitive here. Appearances are of the utmost importance.


  13. The Great Pumpkin says:

    That’s not a high performance car. That’s how I would describe the f80 m3…they perfected it. It is the civic of its class. Reliable as f’k.

    Look up the cooling system. Insane. Keeps engine running at a much lower temperature…you can turn it on or off, so I see the difference first hand. They figured out that heat was the absolute enemy.

    BRT says:
    August 14, 2023 at 12:04 am
    4 years no problems? Is that good? My 2012 Civic has had zero issues in 11 years other than a starter dying.

  14. ExEx says:

    Ammon Bundy is a piece of shit.

  15. NJCoast says:

    Working backstage I’ve never asked for a picture or an autograph of anybody. So for the only time ever I let my sister bring her Sundown album to be signed by Gordon Lightfoot backstage. It was my first time working for him and I was looking forward to meeting the handsome man on the album cover. So after dinner this guy who looked like the Crypt Keeper comes over and asks me if I want him to sign the album. I figured he was some old member of the band so I politely said that I was waiting for Gordon to sign it. He then repeated would you like me to sign your album? He certainly didn’t age well.

  16. Phoenix says:

    Don’t worry. Jingle Mail, banks bailed out, too big to fail. It’s been done before reliably and so has been field tested.

    Remember, life is like the second law of thermodynamics. It’s from the entropy that is tapped into that you create new order, new structure, and profit handsomely.

    Never let a crisis go to waste. There is a stream of revenue to be gained from it. Physics says so.

  17. Phoenix says:

    Also remember,
    Critical failure happens in stages.

  18. Fast Eddie says:


    I wanted to go see Gordon last year but his voice was just gone after viewing some Youtube vids. But what great music and lyrics he created. Omg. No, he didn’t age well. I presume a lifetime of smoking will do that sort of thing.

  19. Fast Eddie says:


    Critical failure happens in stages.

    Except when you’re 10,000 feet under water in a tin can not ready for prime time Titanic viewing. Then, critical failure is swift.

  20. Phoenix says:

    It still happened in stages.

  21. Libturd says:

    Have you guys seen what Billy Corgan looks like now?

  22. Fast Eddie says:

    It still happened in stages.

    1) What’s that sound?
    2) OMG!
    3) Squish.

  23. Juice Box says:

    Going to see Billy on the 24th at PNC, he still shreds and sounds great, Vampire look was always his thing anyway..


  24. Trick says:

    Wife’s car needs to go back to the dealer, picked it up Friday, Saturday oil all over the driveway. Thankfully our other car is a toyota.

  25. Chicago says:

    Stu: I know the history. FYI. I checked out the Resorts just because it was maybe a 7-8 minute drive. Eeek. Such a degenerate gambler place. Relatively new, but a pathetic crowd. All secondary signs are in Chinese characters. They have a bus drop off lobby which reeks of cigarettes. A smattering of gweilo, but most employees were mainland. All the pit bosses were Asian women. The dealers were slow and personality-less. The craps table was a waste. I hit a bunch of odds and payoff were shit, hence that is the tip-off that it pervades the whole place. Players had no social manners and staff did not correct. Hochul thinks this is good for NYS? It is waiving the white flag on society.

    Several Hasids walking arond as if they were visiting the zoo.
    Libturd says:
    August 14, 2023 at 10:12 am
    Chi. Was up in Monticello Saturday night for a Sunday Camp drop off with the D. If you weren’t aware, Monticello was the heart of the Borsch Belt

  26. Libturd says:

    We stayed at the Resorts since I had a free room. POS casino for sure. High limits and low odds. They do have playable video poker, but I would need a 9 times comp multiplier for a positive expectation. Their comp rate is supposedly high, but I never gambled long enough to do the math. Definitely designed for the degenerate gambler. Though, they have a great pool for the kids and adults (separate) and the Chinese food there is supposedly serviceable.

    Best food in Monticello are the bagels sadly.

  27. Libturd says:

    FYI, Genting Gaming owns ResortsWorld hence the Asian everything. Genting Group is headquartered in Malaysia. There is one in Las Vegas too and in NYC. They are cheap, cheap, cheap.

  28. ExEx says:

    Gordo liked the ladies.

  29. Juice Box says:

    Is it worse than Resorts in Queens with their 1 cent slot machines or heck the Resorts in AC if you like that 1970s feel.

  30. Boomer Remover says:

    It’s always striking (to me) how cheap everything in these homes is. Cheap TV sets, cheap workout equipment, cheap appliances, just cheap mouth-breather everything. What will these people do with this insane amount of money, which is for sure more than they ever saw in their life? Unless an estate sale.

    I think it’s clear that I will not be purchasing in NNJ. The question is where? It’s the only thing that keeps us up at night.

  31. Libturd says:

    Resorts in AC is actually a good gamble if you get past the retro. They comp great too. But it is not fancy for sure. There may be a Taco Bell in the casino.

  32. Boomer Remover says:

    I do want to grab a multi in a solid B neighborhood close to NYC, like in Cliffside Park or something, but cap rates are stupid, and I’d need to bring in the better part of half a mil to even cashflow to cover prop management.

  33. Juice Box says:

    I was up north in over the weekend. Took Rt 20 North from Parkway to Hawthorne to get to Ridgewood, saw the usually dicey eastern areas of Paterson etc and later drove around other areas Paramus and down Rt 17 and Rt 4 etc. The sheer amount of roadside garbage everywhere especially on the entrance and exits ramps to highways was really 3rd world level of appalling even in the nicer areas. I know it’s always been a problem as drivers roll down their windows and use the ramps as garbage cans, but I have never seen it that bad. Is there no cleanups anymore? They used to use prison labor to do it sometimes, has our governor banned it?

  34. 3b says:

    Juice: I have been saying it for some time now. Bergen co even the nicer areas are starting to look very dirty and shabby.

  35. Fast Eddie says:


    I think it’s clear that I will not be purchasing in NNJ. The question is where?

    Perhaps a question for an AI application. :) Where can I get the most bang for my buck which is not to be confused with getting banged for a buck.

  36. Brt says:

    Pumps, you are still not making your point. I drove a mustang cobra for 8 years with zero issues. 4 years out no issues is not something to celebrate. It’s to be expected. And if it did break down, you are driving it like a douche.

  37. BRT says:

    I’m in AC for the airshow Wed. Blue angels just did a bunch of practice flyovers. Saw the vertical climb.

    Speaking of Bullies, on the radio on the way up, Fallout boy made a continuation of we didn’t start the fire. What a pile of trash. They just randomly spout off events in no chronological order

  38. The Great Pumpkin says:

    Good luck, lots of competition. F’ing best move of my life was getting that rental when no one wanted it 24 years ago. Now it just prints money….like having 2 million in stock indexes. F’ing wild and I am way below market rate. No mercy now, I have to raise the rents. Hoping they leave, because even after a raise, they are way below market. That’s why they won’t leave.

    Boomer Remover says:
    August 14, 2023 at 1:22 pm
    I do want to grab a multi in a solid B neighborhood close to NYC, like in Cliffside Park or something, but cap rates are stupid, and I’d need to bring in the better part of half a mil to even cashflow to cover prop management.

  39. The Great Pumpkin says:


    Read that reddit forum I shared.. from die hards mouth. Consensus believes it’s a tank.

  40. Mike S says:

    17 week is looking pretty good, auction in 2 days, hope rate stays high!

  41. The Great Pumpkin says:

    I had my physical. Got my cholesterol levels all much lower than last year at this time. Statins rule. It runs in my family, our bodies produce too much cholesterol. My siblings still didn’t start taking the pills, and I am telling them to take it.

    The doctor believes the 6 1/2 day water fast I did this summer worked wonders. My blood pressure last year was 120/90. Now, 104/70. Boom!! Also, lost 10 lbs that I have not put back on after a month. And I am eating the same food. It really is a game changer. I still fit the same in my clothes, so it must be from fat I really couldn’t see…i am in shape, not fat to begin with. So, it must have cleaned up my arteries and other areas. Amazing. Was so happy when the doctor gave me the reading.

  42. chicagofinance says:

    For my experience, you go to the casino for the atmosphere….. otherwise, why not just gamble online? Why go to a garbage can?

    Libturd says:
    August 14, 2023 at 1:21 pm
    Resorts in AC is actually a good gamble if you get past the retro. They comp great too. But it is not fancy for sure. There may be a Taco Bell in the casino.

  43. Phoenix says:

    It doesn’t clean your arteries.

  44. BRT says:

    Have you ever met anyone that didn’t think the expensive car they bought was the greatest?

  45. The Great Pumpkin says:

    Doesn’t it force the body to start eating itself, starting with all the bad stuff first? Like all the corrupted cells and what not?

  46. The Great Pumpkin says:

    30 year mortgage rates at 7.5%.

  47. Libturd says:

    “For my experience, you go to the casino for the atmosphere….. otherwise, why not just gamble online? Why go to a garbage can?”

    If you are a recreational gambler, yes. My decision is based mainly on which casino offers me the best combination of benefits (where they have other locations, cash back, gifts and comps) while having games which I can exploit to my advantage. Of course, when it includes great ambiance, it’s a win, win. It’s why in AC, I have moved from the Caesars properties over to MGM and Bally’s. In Vegas, I have to play at the locals casinos, but I can use my Borgata (MGM) comps at any casino restaurant,. bar, sauna or gift shop from the Luxor, all the way up to Bellagio on the North side of the strip. A few of them have 99% games. But they never offer comp multipliers so I use my free play and free hotel rooms, but make money at the Stations or M or SouthPoint.

    Quite frankly, I’m starting to tire of it a bit, which will be good when I move out to Vegas.

  48. Fast Eddie says:

    30 year mortgage rates at 7.5%.

    It might as well be 3% or 10% around here, neither moves the needle when it comes to multiple bids. Name your price, pour a glass of wine, sit back and watch the action.
    Some towns have one street where everyone wants to live, we have whole counties.

  49. Grim says:

    Speaking of weight loss, I’m on the verge of hitting the 40 pound down mark.

    That’s over 5 months, not too shabby.

    Pants don’t fit. Belts are on holes never before used. Feel great, have abs.

    It’s been entirely pleasant as well.

  50. The Great Pumpkin says:

    Welcome to the abs club! Lol


  51. The Great Pumpkin says:


    For you. This guy is one smart dude. Divorce lawyer. Man of logic. The few..


  52. The Great Pumpkin says:

    Institutional ownership is up to almost 70% in DNA. Holy chit!

  53. The Great Pumpkin says:

    I have no balls to short it at these levels. These are long buys only at these levels.

  54. The Great Pumpkin says:

    Been killing it, but did get eaten. Had to learn from my mistakes again. Always hold your nerves and stick to your gut. I entered a huge short position at 2.03 on DNA. They got me. They ran it up to 2.17 on false pump, and I had to cut my loses. Of course at the top of the pump where I had no choice but to trigger/cut my losses. These people are f’ing good.

  55. The Great Pumpkin says:

    I like other stocks, but right now, I know this stock so well, that my best choice is to swing this stock over and over. Uptrend now. Higher highs, and higher lows, but this a rollercoaster, big drops.

    Charts for previous post.


  56. The Great Pumpkin says:

    My fav part. Ark has been buying this hands over fist and not saying a word. Zero pump.

  57. The Great Pumpkin says:

    I value that kind of chit.

  58. Fabius Maximus says:

    I need a moment on this one. I need to find something good in the drinks cabinet to toast this with.

    Go Rico!

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