Of the 15 states most affected by natural disasters, California and Florida had the highest non-renewal rates in 2024, a Weiss Ratings study found.

The Federal Open Market Committee voted to reduce interest rates by 25 basis points Wednesday, but the emergence of dissents on the committee makes the chance of another quarter-point cut in December less certain.

An index of contract signings held at 74.8 after climbing a revised 4.2% a month earlier to the highest level since March, according to National Association of Realtors data released Wednesday.

The deal will help drive development at Mortgage Cadence, which had been a unit of Accenture, and enable new integrations and automation, according to leaders.

Mortgage groups want GSEs to buy MBS to lower rates, but the Chairman of Whalen Global Advisors writes that the plan is risky, unnecessary, and poorly timed.

Today was not a foregone conclusion and there was no way to know ahead of time that it would end like this, but the outcome is exactly why we’ve gone to such lengths to warn you about the potentially paradoxical reaction to a Fed rate cut.  Too many people repeat the fallacy that mortgage rates will benefit from a Fed cut.  We have several recent examples of the exact opposite happening, and now today adds another strong reminder with the average lender moving higher at the fastest pace since the day after the last Fed meeting. Why does this happen?  It has nothing to do with the rate cut itself.  As we warned, volatility would come from Fed Chair Powell’s press conference. In today’s case, Powell said that another rate cut in December was not a foregone conclusion.  This was at odds with the market’s expectations, so there was a rush to reprice those expectations.   As always, today’s rates instantly adjust to expectations for rates in the future (the main reason that Fed rate cuts do little-to-nothing to impact market rates).   In relative terms, rates are still lower than most of the past year, but back up to similar levels seen on October 14/15th. 

Another Hawkish Powell Press Conference Harshes Bonds’ Mellow

The Fed cut rates and ended QT.  Neither were surprises for markets and neither had an impact.  The press conference was hawkish, however, with Powell saying a December cut was far from a foregone conclusion.  This is very much counter to the market’s expectation that a December cut was a lock.  Fed Funds Futures tanked and yields surged about 8bps in the 10yr.  MBS lost about 3/8ths and negative reprices continue to roll in.  

Econ Data / Events

Case Shiller Home Prices-20 y/y (Aug)

1.6% vs 1.9% f’cast, 1.8% prev

CaseShiller 20 mm nsa (Aug)

-0.6% vs — f’cast, -0.3% prev

FHFA Home Price Index m/m (Aug)

0.4% vs 0.1% f’cast, -0.1% prev

FHFA Home Prices y/y (Aug)

2.3% vs — f’cast, 2.3% prev

CB Consumer Confidence (Oct)

94.6 vs 93.2 f’cast, 94.2 prev
Labor differential: 9.40 vs 7.80 prev

Market Movement Recap

10:26 AM modestly weaker overnight and holding steady so far.  MBS down 1 tick (.03) and 10yr up 1.6bps at 3.992

01:28 PM 10yr yields are up 2.9bps at 4.005 and MBS down 3 ticks  (.09)

01:41 PM MBS now down 5 ticks (.16) and 10yr up 3.5bps at 4.012

While Rocket Mortgage’s satisfaction score improved by 4% versus 2024, the industry as a whole dropped 1%, with credit unions outpacing banks and IMBs.

Lenders and investors say the new rules will increase the cost of financing and limit homeowners’ access to equity by curbing the enforceability of contracts.

Bilt members will be able to earn benefits through Venmo use, with the agreement coming after the company recently added mortgage payments to its points mix.