June Mortgage Rate Outlook Through Oil Prices And The Fed

Mortgage rates hold in the mid-six range, with paths to the low sixes through buy downs, and we explain how oil prices and the 10-year Treasury shape what you see day to day. We also dig into competing inflation measures the Fed may weigh differently, then pivot to a time-sensitive CE deadline reminder for real estate agents. 

Agents don't forget CE is due NOW in order to make sure you keep your license!

Transcript

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All right. Welcome to this week's Monday Market Update. It is the week of June 1st. Nikki, how's it going? Everything is looking really good. From an interest rate standpoint, we're still pushing into that mid-six range, and we can get to the lower sixes if we uh, you know, do some buy downs and things of that nature. The thing that's really driving that, you know, push rates down is, you know, really oil prices coming back down. We're now down to $90 a barrel, you know, which is really good. I think we hit our height at like about $120. So, and with that coming down, that kind of eases a 10-year treasury, which helps the mortgage interest rates

Mid-Six Mortgage Rate Check-In

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kind of push back down into that six range, your solid lower six range, which is great. Moving forward, the Trump administration believes that they're going to get a deal to open the Strait of Ormuz this week or into next week, which would be great because that would actually push things down even further and make things more beneficial from a mortgage interest rate standpoint. Also, transition of Kevin Warsh coming into the Fed as chair of the Fed. He has made some kind of determinations on the Fed looking at inflation rates differently than they did before. Inflation currently is looked at with core PCE, which is you know talks about just inflation overall and measures everything, including, you know, some maybe even some geopolitical events that can influence inflation, um, just some temp very temporary things. But there's another measurement of inflation called, it's called the Dallas Fed trimmed measurement. And what this does is it excludes

Inflation Metrics And Fed Signals

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the top 30% of increases and the bottom 20% of increases and kind of grabs that middle amount of different things that have been increasing from an inflation standpoint and gives it a different measure because what the theory is is that if we exclude things that are temporarily infecting affecting inflation, such as, again, oil prices, this, you know, the conflict in Iran, and you know, things that are also, you know, just remaining stable. Maybe it's the price of eggs or something like that. We can really get a good read on what inflation is. Court PCE right now has inflation at 3.3%, whereas the Dallas measure has the inflation at 2.3%, which Warsh believes is a really more accurate measure of inflation and decisions that need to be made. It doesn't, you know, it doesn't come without its faults, of course. You know, we there's really, you know, it's just one person's opinion over the other on what we should look at from an inflation standpoint. So hopefully, you know, with some changes and things of that nature, we can start to see that Fed rate come down as appropriate once the Iran conflict is is taken care of. So a lot of things happening, things of that nature, which are going to affect mortgage interest rates from a long-term standpoint. So we're just kind of, you know, as usual, holding and waiting, however, not uh discouraging anyone from purchasing a home. So yeah, yeah. No, because rates have been, I mean, mid-sixes, buy down to low sixes, that's kind of been where we've been at, it feels like for a while. So absolutely, yeah. That's where you've been out for kind of the status quo. And there have been some ups and downs, you know, with things going up a little bit and coming back down, or even going down a little bit and coming back up. So but that's really where we're at right now. And once Kevin Morrish gets in there and things start moving from that standpoint, we should see some movement later on this year. Perfect. No, that makes perfect sense. And with it being June, you know, I'm I know that a lot of agents out there, our CE is due for the most part at the end of June. So I just wanted to put a friendly reminder out there to any agents listening. If you are not done with your CE yet, I would get on it now. I know many agents that have waited to the last minute and lost their license because your broker and it still has to register in Pulse Portal, and they have 10 days to do that. So truly, you should be done no later than June 15th if

CE Deadline Warning For Agents

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you want to be assured to keep your license. Anything after that, you are really gambling. So I know I have a little bit more to do myself, so I am in that category as well. Um, and that is why you know, time just slips away, and now that's summer and kids are getting out of school and there's a lot going on. Do not forget your that's correct. Absolutely great message. Oh, perfect. Well, I really appreciate you jumping on today, and yeah, be looking for the Monday market update next week as well, and every week after there. How do they reach you if they have any questions in the meantime? Uh, you can find me on Instagram, Facebook, or TikTok at mortgages from M N to A Z, or you can text me or call me at 952 484 1584 or email me at Nikki at Kevnik Group.com. Perfect. Wonderful. Tell next week, go and sell something and have a great one. Talk to you later.