Rates Down, Stocks Up: The Housing Reality Nobody's Talking About

Interest rates continued their downward trend last week, settling into the 6.5-6.625% range as the stock market reached all-time highs following a significant Senate bill passage. 

• Interest rates saw consistent decreases throughout last week
• Stock market at all-time high, positively affecting mortgage bonds
• Recent CNBC report highlighted 0.05% increase in 30-60 day mortgage delinquencies while ignoring decreases in longer-term delinquencies
• Overall delinquency rates are lower compared to last year
• Morgan Stanley forecasts on rate cuts by end of 2026...
• Fundamental economic indicators (lower inflation, higher stock market) support continued stability

Find Nikki on social media at "mortgagesfromMNtoAZ" on Instagram and TikTok or as Nikki Erickson on Facebook to share her content with your clients.

Chapters

• 1:10 Monday Market Update Introduction
• 2:15 Interest Rate Trends and Progress
• 3:14 Media Reporting on Mortgage Delinquencies
• 5:27 Future Fed Rate Predictions
• 7:51 Key Takeaways for Clients
• 9:20 Closing Remarks and Social Channels

Transcript

Speaker 1: 0:35

All right, cool, it is now live streaming, awesome. Well, welcome you guys to our Monday Market Update. Angie Gerber, myself and Nikki here are always here on Mondays to give you kind of an update on what's going on in the market, how you can share that with your database, your sphere, on your socials and just to give you confidence to service your clients. And Angie is out today on a vacation, so we're just going to go ahead and give you your update today. This is always um, also able to be found in EXP family tree. If you're with EXP. We live stream this every week, um, and also on Angie Gerber's YouTube channel, and you can just go ahead and search her name when you're in YouTube to find a lot of the past ones. I heard last week was awesome, nikki, so, nikki, so you guys should go back and watch that for sure, and otherwise I'm going to let you take it away.

Speaker 2: 1:22

Yeah, absolutely Well. Happy Monday everybody. Happy 4th of July week. Just a reminder to start sending out those happy 4th of July texts to your clients and wish it's a good touch point for them and a good way for you to be able to just be in front of them in a unique way.

Speaker 2: 1:40

As far as interest rates go, we had an amazing week last week as far as lowering those interest rates and putting pressure down on those bond numbers. If you take a look at the charts, you can see that this was right here about the beginning of the week and we just did a nice slow lowering of all of the interest rates all week last week. It was a wonderful week. We're back down into the 6.5, 6.625 range. We're hoping that that continues. Some of the things that are going to start to influence this is number one the big beautiful bill passed through the Senate which helped the stock markets go crazy, and so the stock market is at an all-time high right now, which is actually helping everything from the mortgage bonds as well. So everything is looking really good from that standpoint and we expect to see a continuous kind of lowering or stability of the interest rates right now, which is great news. So I really want to talk today about the media and what articles have came out lately, what reports have been in the media about housing and kind of talk through where we are now and what reports are coming out and where we were last year. And it's important because a lot of times, just as a reminder, people get their information from the media and those sources are used a lot of times to incite fear in people when the reality is the market isn't what they are trying to tell us. It is.

Speaker 2: 2:53

So, first and foremost, diana Oleik, who is a reporter for I believe it's CNBC. She came out with a report or did a journalistic report this past week talking about mortgage delinquencies and she was talking about an increase in mortgage delinquencies from last month for people who are 30 to 60 days late. That is true, there is a slight increase by 0.05%. You have to take that and you have to look at the number of people who are 60 to 90 days late and 90 to 120 days late also, those numbers from 60 to 90 and 90 to 100 have gone actually down significantly in the last three months. That was not part of the report. The only part that was reported on is the slight increase in those that have gone 30 days late on their mortgage. So there's a couple of things that are happening here. Number one, mortgage companies are saying, ok, if you do get 30 days late, we're going to work with you to get back on track. And number two, the number of people that are able to catch up on the 60 or 90 or 120 day lates is increasing, which is really good too, whether that's by having additional income come into the home and start to make up for those delinquencies, whether that's working with the mortgage company. The point being is that the report that happened basically takes one little small aspect of seeing mortgage lates and putting fear in people and saying, oh, the world is ending because people can't make their mortgage payment, when in reality, if you look at where we were last year at this time, there were significantly more delinquencies overall, and so you just kind of have to make sure you can help your clients, obviously weed through the misinformation or the kind of slightly, you know, leaning information one way or another.

Speaker 2: 4:38

Another important part of this is going to be where mortgage interest rates were and what is the prediction on the dropping of mortgage interest rates or the dropping of that prime rate by the Fed over the next year. This time last year, the experts were predicting that we would have five significant drops in that Fed rate from January of 2025 through the end of the year. And as time went on, that number became lower and lower and lower. And in December, as a reminder, powell said we plan on one, we'll be lucky if we get two. Well, that has now came to fruition. We've gotten one, we're going to be lucky if we get two.

Speaker 2: 5:21

However, morgan Stanley came out with an article that did the same thing predicted six to seven interest rate drops from the Fed in 2026, so that by the end of 2026, we can see pre-COVID or during COVID numbers of those mortgage interest rates or of those Fed rates. And so here is Morgan Stanley, who is a very reputable expert within the industry, is coming on record and saying oh yeah, we're gonna have six to seven more drops between now and the end of 2026. When, in reality, that could just not be true. It could just not happen again. So, as a reminder, as you are talking to your clients and we're talking about mortgage interest rates or we're talking about, hey, when do you think the rates will drop? Obviously I can have those conversations. That's not a huge deal. But if you do get asked the question, just say we don't really know, because the experts are predicting these things and sometimes they are right and sometimes they are wrong. But an interest rate shouldn't deter you from purchasing a property when it's the right time to purchase a property, because the interest rates are going to do what they're going to do.

Speaker 2: 6:24

I'm hopeful that we'll see some continuous drops. The inflation numbers have come down significantly and you know the tariff income that's coming in. All these things are helping the economy, with the stock market being high and things like that. So, logically speaking, that Fed interest rate should be able to come down based on all the data. Now Powell and the team of Fed agents is a major decision maker, obviously, in whether or not these interest rates come down, and so, even though every statistical data point that they've stated that they want to meet has been met, for whatever reason, they're a little bit scared still of lowering that interest rate. So it'll be interesting to see in the July meeting and the August meeting what happens and if we can get a little bit of a lowering of that Fed interest rate.

Speaker 2: 7:08

Last reminder, that Fed interest rate is not the same as the mortgage interest rate. It is what's used for a short-term lending from a bank standpoint, whereas the mortgage interest rate goes off the 10-year treasury bond, but there is an influential correlation between the two. So, just, I guess the point is today, you know if you have clients that are on the fence. If you have, you know people that are wondering when the right time to buy is. Interest rate does not have to be a deterrent to do so. And we are also seeing that the media is kind of skewing things right now to put a little bit of fear in people and say, ok, you know, there's these mortgage delinquencies or this thing, a bad thing is going to happen, when in reality the overall picture looks really good right now for housing.

Speaker 1: 7:56

I'm muted. Sorry, that's awesome. That is really really good Great information. Sorry, that's awesome. That is really really good, Great information. What I love about this call you guys is you can see that in about 10 minutes or less, you can get some really good information to start your week off. If you aren't doing this, you should be, because you should be able to relay this information to your clients, to your prospects, to your buyers, to your current sellers out on social media. By the way, Nikki, if people are watching that haven't watched before, you do a lot of this on your own socials and they can share that right?

Speaker 2: 8:25

Yes, absolutely. So you can find me at at mortgages from MN to AZ. That's my handle for Instagram and also for TikTok. You can find me on Facebook under Nikki Erickson and then, yeah, you can. All my socials are shareable. You can do whatever you need to with them. They're all there, available and ready for you and you don't have to put much thought into it. You can just share them and it works.

Speaker 1: 8:46

That's exactly right. I love it Awesome. Thank you so much for being with us every Monday. Have a great week everyone. Bye-bye, Bye.