Morning! This is MF Lending - the sun may be setting at what feels like 11am, but we are still here to serve up mortgage and real estate market knowledge without any of the guesswork. So you’ll look like the smartest agent in the room (and you are!)

Here’s what we’ve got for you today:

1. This Week’s Wrap-up 🗞️

2. Goldman Economist gives his 2024 predictions 🎥

3. Nashville Ranks #1 in Overall Real Estate Prospects 🏆

By the way, this article on How the bond rally affects clients’ payments is the most clicked link in this newsletter, you should check it out if you are interested.

Was this email forwarded to you? Subscribe to get it directly!

Rates Today 📉

This Week’s Wrap-up 🗞️

As expected - this was the quietest week in the bond market in recent memory.😴

The dust has finally settled after the bond market rally last week…and it feels like a new ceiling has been established, holding rates around 7.5%.

This feels reminiscent of April/May of this year when there was this artificial ceiling at 6.5% rates for two to three months.

As we move into the weekend - I do not expect rates to adjust materially as your clients look at homes.

They can expect rates to stay steady as they negotiate and make offers on homes…a nice reminder of how things should be.

However, if you do plan on making offers over the weekend, I would highly suggest having the negotiations wrapped by EOD Monday.

Why?

Tuesday is the October CPI Print. This is the Fed’s favorite measure of inflation and this report typically moves the bond market dramatically.

Along with CPI, we also have this data coming out next week:

1. Retail Sales Data - Wednesday

2. Homebuilder Data (housing starts, building permits, etc) - Friday.

A big week is on the horizon that could impact the current landscape.

But for now, enjoy the consistency and calmness in the bond market - go out and get some sunshine this weekend 😎.

Goldman Economist gives his 2024 predictions 🎥

Goldman Chief Economist, Jan Hatzius, had a discussion on CBNC yesterday afternoon about his outlook on inflation and the Fed’s next steps.

He believes we can bring inflation down to our goal next year, without hurting the economy. 

His main argument is that there are significant “tailwinds” to global growth, that will help drive the economy next year. Most notably:

1. Strength in real disposable household income growth.

   • Based on their research - real wage growth is starting to occur (as prices begin to fall faster than wages are falling)

2. The “lag negative impact” is already behind us

   • Through 2023, some economic data from 2022 has inflated the year-over-year data points, creating a lag affect on the real numbers. He believes we are on the other side of this lag, which would result in inflation falling faster than it is currently.

Even with this positive outlook, Jan believes that -“The Fed does nothing next year”. He does not foresee rate cuts wont happen end of 2024 at the earliest.

Nashville Ranks #1 in Overall Real Estate Prospects 🏆

For the third year in a row, Nashville was ranked #1 in Overall Real Estate Prospects - according to this Emerging Trends Report.

Here are some of the other key takeaways from the report:

1. Most Important Issues for Real Estate

   1. Interest Rates & Cost of Capital

   2. Construction Labor Costs

   3. Housing Costs and Availability

2. Nashville Ranked #20 in Homebuilding Prospects

3. Along with cities like Austin, Boise, Raleigh/Durham, and others - Nashville is included in the “Supernova” category for real estate markets.

   1. “Supernovas” have had tremendous and sustained population and job growth.

4. Cities in the “Supernova” category are forecasted to have a population growth of 7.6% by 2028.

The Cul-de-Sac

Thanks for reading - that is all we have for today 😎

Please forward this to your friends and colleagues if you found it valuable.

— Michael F DiLucchio