PANDORA’S BOX EVERYTHING GOT OUT. THE HOPE IS AT THE BOTTOM. |
THE ONE-WAY DOOR Fannie Mae now puts the 30-year mortgage at 7.5% in every quarter of 2027 A month ago the same forecast said 6.7%. Builders have been calling conditions poor for twenty-nine months running. |
December 2027. That is as far as Fannie Mae’s October forecast reaches. The 30-year mortgage is still at 7.5 percent when it gets there. |
The forecast went out on October 14. It puts the average 30-year fixed rate at 7.4 percent this quarter. |
Then 7.5 percent in all four quarters of next year. Not a dip. A shelf. |
| 7.5% EVERY QUARTER OF 2027, PER FANNIE MAE | → | The September version of the same forecast said 6.7 percent. The call moved 0.8 points in four weeks, and it moved up. |
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One detail matters here. Fannie Mae set its rate assumptions on September 30. |
So this is not a reaction to the hot inflation print of October 14. It was already this bad before that number landed. |
The 30-year sits around 7.4 percent today on the Freddie Mac weekly average. That is roughly a three-year high. |
Underneath it sits the bond market. Fannie Mae has the 10-year Treasury near 5.3 percent right through 2027. |
Fannie Mae now puts the 30-year mortgage at 7.5 percent in every quarter of 2027. If you were planning to buy or move, would you do it now or keep waiting? Hit reply and send us one word: NOW or LATER. |
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The revision shows up fastest in refinancing. Fannie Mae cut its 2027 refinance forecast to $430 billion, from $802 billion. |
Total single-family lending goes from about $2.085 trillion this year to $1.865 trillion next. |
House prices flatten rather than fall. Fannie Mae has them up 2.7 percent this year and 0.6 percent next. |
Existing-home sales were cut too, to 4.06 million from 4.22 million. |
The people who build the houses saw this first. Their confidence index fell three points to 32 in September. |
That is the lowest in a year. Anything under 50 means more builders call conditions poor than good. |
By the builders’ own count, July was the twenty-seventh reading in a row under 50. September made twenty-nine. |
October’s reading lands at nine this morning, Central time. The consensus is 31. |
Housing starts have fallen in four of the last five months. This will be the second straight year of fewer single-family homes built. |
The builders’ chief economist points somewhere unexpected for part of the blame. |
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Growth this year has leaned on one sector, AI. In his reading that is crowding out lending for the rest of the economy, housing included. |
The rest of the builders’ list is more ordinary. Tight lending, land, labor shortages, material costs, and the price of gas and diesel. |
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EVERY LEAD PASSES BEFORE IT RUNS The One-Way-Door Test |
01 | Can it be undone? A forecast can be revised, and this one just was. A rate locked at the wrong moment cannot be. | |
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02 | Who is already repositioning? Lenders. The 2027 refinance book was marked down to $430 billion from $802 billion in one revision. | |
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03 | What does being late cost? Rate is the one line on a mortgage that follows you for the whole term. It is not a monthly decision. | |
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THE MOVE · WHILE THERE IS STILL TIME Find the rate on your last mortgage statement, or on the last quote you were given. Write 7.5 percent beside it. That gap is what you are actually deciding about. Forecasts move. This one moved 0.8 points in a month, and it can move back the other way just as fast. |
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ALSO GOT LOOSE TODAY | Futures bounced on Monday morning after last week’s chip selloff. Nasdaq 100 futures were up about 1.3 percent before the open. | MONEY |
| China reported third-quarter growth of 4.5 percent against a 4.4 percent forecast. Retail sales rose 1.1 percent, where 0.5 percent was expected. | WORLD |
| Housing starts and building permits land tomorrow. Permits are expected at 1.40 million and starts at 1.30 million. | LATER |
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WHAT’S LEFT AT THE BOTTOM A forecast is a guess with a date attached. This one moved 0.8 points in four weeks, which tells you exactly what the date is worth. WE WATCH THE BOX. |
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