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

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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

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Episode Transcript

Speaker 1 (00:00):
All right, cool, it is now live streaming, awesome.
Well, welcome you guys to ourMonday Market Update.
Angie Gerber, myself and Nikkihere are always here on Mondays
to give you kind of an update onwhat's going on in the market,
how you can share that with yourdatabase, your sphere, on your
socials and just to give youconfidence to service your

(00:20):
clients.
And Angie is out today on avacation, so we're just going to
go ahead and give you yourupdate today.
This is always um, also able tobe 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 canjust go ahead and search her
name when you're in YouTube tofind a lot of the past ones.
I heard last week was awesome,nikki, so, nikki, so you guys

(00:43):
should go back and watch thatfor sure, and otherwise I'm
going to let you take it away.

Speaker 2 (00:47):
Yeah, absolutely Well .
Happy Monday everybody.
Happy 4th of July week.
Just a reminder to startsending out those happy 4th of
July texts to your clients andwish it's a good touch point for
them and a good way for you tobe able to just be in front of
them in a unique way.
As far as interest rates go, wehad an amazing week last week as
far as lowering those interestrates and putting pressure down

(01:08):
on those bond numbers.
If you take a look at thecharts, you can see that this
was right here about thebeginning of the week and we
just did a nice slow lowering ofall 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 thatcontinues.
Some of the things that aregoing to start to influence this
is number one the big beautifulbill passed through the Senate

(01:31):
which helped the stock marketsgo crazy, and so the stock
market is at an all-time highright now, which is actually
helping everything from themortgage bonds as well.
So everything is looking reallygood from that standpoint and
we expect to see a continuouskind of lowering or stability of
the interest rates right now,which is great news.
So I really want to talk todayabout the media and what

(01:57):
articles have came out lately,what reports have been in the
media about housing and kind oftalk through where we are now
and what reports are coming outand where we were last year.
And it's important because alot of times, just as a reminder
, people get their informationfrom the media and those sources
are used a lot of times toincite fear in people when the
reality is the market isn't whatthey are trying to tell us.

(02:17):
It is.
So, first and foremost, dianaOleik, who is a reporter for I
believe it's CNBC.
She came out with a report ordid a journalistic report this
past week talking about mortgagedelinquencies and she was
talking about an increase inmortgage delinquencies from last
month for people who are 30 to60 days late.

(02:39):
That is true, there is a slightincrease by 0.05%.
You have to take that and youhave to look at the number of
people who are 60 to 90 dayslate and 90 to 120 days late
also, those numbers from 60 to90 and 90 to 100 have gone
actually down significantly inthe last three months.

(02:59):
That was not part of the report.
The only part that was reportedon is the slight increase in
those that have gone 30 dayslate on their mortgage.
So there's a couple of thingsthat are happening here.
Number one, mortgage companiesare saying, ok, if you do get 30
days late, we're going to workwith you to get back on track.
And number two, the number ofpeople that are able to catch up
on the 60 or 90 or 120 daylates is increasing, which is

(03:23):
really good too, whether that'sby having additional income come
into the home and start to makeup for those delinquencies,
whether that's working with themortgage company.
The point being is that thereport that happened basically
takes one little small aspect ofseeing mortgage lates and
putting fear in people andsaying, oh, the world is ending
because people can't make theirmortgage payment, when in

(03:43):
reality, if you look at where wewere last year at this time,
there were significantly moredelinquencies overall, and so
you just kind of have to makesure you can help your clients,
obviously weed through themisinformation or the kind of
slightly, you know, leaninginformation one way or another.

(04:03):
Another important part of thisis going to be where mortgage
interest rates were and what isthe prediction on the dropping
of mortgage interest rates orthe dropping of that prime rate
by the Fed over the next year.
This time last year, theexperts were predicting that we
would have five significantdrops in that Fed rate from

(04:28):
January of 2025 through the endof the year.
And as time went on, thatnumber 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 tofruition.
We've gotten one, we're goingto be lucky if we get two.
However, morgan Stanley came outwith an article that did the

(04:50):
same thing predicted six toseven interest rate drops from
the Fed in 2026, so that by theend of 2026, we can see
pre-COVID or during COVIDnumbers of those mortgage
interest rates or of those Fedrates.
And so here is Morgan Stanley,who is a very reputable expert
within the industry, is comingon record and saying oh yeah,

(05:11):
we're gonna have six to sevenmore drops between now and the
end of 2026.
When, in reality, that couldjust not be true.
It could just not happen again.
So, as a reminder, as you aretalking to your clients and
we're talking about mortgageinterest rates or we're talking
about, hey, when do you thinkthe rates will drop?
Obviously I can have thoseconversations.

(05:32):
That's not a huge deal.
But if you do get asked thequestion, just say we don't
really know, because the expertsare predicting these things and
sometimes they are right andsometimes they are wrong.
But an interest rate shouldn'tdeter you from purchasing a
property when it's the righttime to purchase a property,
because the interest rates aregoing to do what they're going
to do.
I'm hopeful that we'll see somecontinuous drops.
The inflation numbers have comedown significantly and you know

(05:55):
the tariff income that's comingin.
All these things are helpingthe economy, with the stock
market being high and thingslike that.
So, logically speaking, thatFed interest rate should be able
to come down based on all thedata.
Now Powell and the team of Fedagents is a major decision maker
, obviously, in whether or notthese interest rates come down,
and so, even though everystatistical data point that

(06:17):
they've stated that they want tomeet has been met, for whatever
reason, they're a little bitscared still of lowering that
interest rate.
So it'll be interesting to seein the July meeting and the
August meeting what happens andif we can get a little bit of a
lowering of that Fed interestrate.
Last reminder, that Fed interestrate is not the same as the
mortgage interest rate.

(06:37):
It is what's used for ashort-term lending from a bank
standpoint, whereas the mortgageinterest rate goes off the
10-year treasury bond, but thereis an influential correlation
between the two.
So, just, I guess the point istoday, you know if you have
clients that are on the fence.
If you have, you know peoplethat are wondering when the
right time to buy is.
Interest rate does not have tobe a deterrent to do so.

(07:00):
And we are also seeing that themedia is kind of skewing things
right now to put a little bitof fear in people and say, ok,
you know, there's these mortgagedelinquencies or this thing, a
bad thing is going to happen,when in reality the overall
picture looks really good rightnow for housing.

Speaker 1 (07:20):
I'm muted.
Sorry, that's awesome.
That is really really goodGreat information.
Sorry, that's awesome.
That is really really good,Great information.
What I love about this call youguys is you can see that in
about 10 minutes or less, youcan get some really good
information to start your weekoff.
If you aren't doing this, youshould be, because you should be
able to relay this informationto your clients, to your
prospects, to your buyers, toyour current sellers out on

(07:40):
social media.
By the way, Nikki, if peopleare watching that haven't
watched before, you do a lot ofthis on your own socials and
they can share that right?

Speaker 2 (07:49):
Yes, absolutely.
So you can find me at atmortgages from MN to AZ.
That's my handle for Instagramand also for TikTok.
You can find me on Facebookunder Nikki Erickson and then,
yeah, you can.
All my socials are shareable.
You can do whatever you need towith them.
They're all there, availableand ready for you and you don't
have to put much thought into it.
You can just share them and itworks.

Speaker 1 (08:11):
That's exactly right.
I love it Awesome.
Thank you so much for beingwith us every Monday.
Have a great week everyone.
Bye-bye, Bye.