The average price of a single-family home increased 1.7% from last year to $426,800 in the third quarter.

Company leaders said current strategy sets it up to profit and compete against its rivals as the mortgage market improves in the coming months.

Michael Barr said he believes artificial intelligence will have a positive long-term impact on the economy, though it may cause job losses in the short term.

New guidelines should provide homeownership opportunities for certain consumer segments with thin credit files and open up product options, lenders said.

Federal Reserve Gov. Christopher Waller said there was a popular “misunderstanding” Thursday regarding who can qualify for a “skinny” master account, noting that only firms with a bank charter would qualify for approval.

As of yesterday afternoon, mortgage rates were right in line with the highest levels in more than a month. The upward momentum was largely a product of 2 specific days: the October 29th Fed announcement and yesterday’s duo of economic reports that suggested less cause for concern over the labor market and strength of the services sector. Now today, we have different economic data telling a different story.  Were it not for the government shutdown, the market may have never placed nearly as much emphasis on today’s data. In fact, today is the first time that many market participants have even heard of one of the reports (a synthetic jobs report by Revelio). Revelio’s data suggested a decline in payrolls in October.  Combined with separate data that showed a surge in job cuts, there was a clearly negative message for the labor market. Bad economic news helps bonds which, in turn, is good for rates. All told, today’s move completely erased yesterday’s damage. The average mortgage lender made it almost all the way back down to last Friday’s levels. [thirtyyearmortgagerates]

Have Bonds Found Their Post-Fed Footing?

Looked at one way, bonds have been in a moderate selling trend since Fed day. Viewed through another lens, Fed day caused an isolated lurch toward higher yields and then we were generally sideways until yesterday’s econ data caused another lurch higher.  The common thread in each scenario is that bonds had been unable to find a reason to rally in any meaningful way. Amid such scenarios, we wait for such rallies to restore balance to the near-term outlook. Via weak results in private label econ data, a sharp morning selling spree in stocks (and perhaps some technical support seen as early as yesterday when 10yr yields topped out at 4.16), today provided that rally.  

Econ Data / Events

ADP Employment

42k vs 25k f’cast, -32k prev

ISM Biz Activity (Oct)

54.3 vs — f’cast, 49.9 prev

ISM N-Mfg PMI (Oct)

52.4 vs 50.8 f’cast, 50.0 prev

ISM Services Employment (Oct)

48.2 vs 47.6 f’cast, 47.2 prev

ISM Services New Orders (Oct)

56.2 vs 51.0 f’cast, 50.4 prev

ISM Services Prices (Oct)

70.0 vs 68.0 f’cast, 69.4 prev

Market Movement Recap

09:53 AM Fairly sharp rally at 8:20am CME open with more buying as stocks sell off.  MBS up 9 ticks (.28) and 10yr down 6.3bps at 4.097

01:56 PM very flat near strongest levels.  MBS still up 9 ticks (.28) and 10yr down 7.6bps at 4.084

04:18 PM Still flat into the after hours session. MBS up 9 ticks (.28) and 10yr down 7.3bps at 4.088

The shutdown has not only placed more emphasis on the alternative data that was already in the rotation, but also fueled interest in new sources. One that you’ll likely hear more about in the coming months is Revelio Labs, a company using data aggregation and modeling to synthesize it’s own version of nonfarm payrolls.  While it’s far from an exact match, the trends are similar, and Revelio’s data is less volatile (much like ADP always has been). All that to say, there’s no great way to justify this morning’s rally in bonds without the Revelio release at 8:30am ET, which showed a decline in monthly job creation.

It would be easy to mistake today’s rally as a product of an extremely high number of layoffs reported by the firm Challenger, Gray, and Christmas (aka Challenger Job Cut Report or “Challenger Layoffs”). But note that Challenger was released several hours early in the overnight session.  It definitely had an impact, but bonds went right back to business as usual shortly thereafter. 

Frequent conference goers or traveling salespeople are obviously concerned about the Trump Administration cutting 10 percent of flights for a variety of reasons. 13,000 air traffic controllers and 50,000 Transportation Security Administration agents are working without pay. For anyone looking for a job through the Job Board, here’s a pro tip for a question in your next interview: “Where do you see yourself in five years?” Answer: “Celebrating the 5th anniversary in your lunchroom of you asking me that question.” Job news, good and bad, is in the forefront of economic and residential news. The Trump Administration has apparently fired a mortgage regulator watchdog and Fannie Mae’s ethics staff. Is AI leading to layoffs or does the U.S. economy just stink? (Today’s podcast can be found here and Sponsored by ICE. As the standard for innovation, artificial intelligence, efficiency and scalability, ICE is the technology of choice for the majority of industry participants, defining the future of homeownership. Today’s features an interview with Servbank’s Sharmyn Calhoun on the importance of technology in modern compliance management.) Services, Products, Software, and Tools for Lenders and Brokers Some things don’t just stand the test of time; they keep getting better with it. FirstClose, celebrating its 25th anniversary this month, has spent a quarter century proving that innovation and endurance can go hand in hand. What started as a single-source provider of property data has evolved into a comprehensive end-to-end platform, supporting over 225 lenders and $129 billion in funded loans since 2015. In an industry where technology changes faster than rates, few companies can claim that kind of consistency or impact. As FirstClose marks 25 years, its mission remains as relevant as ever: helping lenders simplify processes, strengthen borrower experience, and turn opportunity into growth. Connect with the FirstClose team to see how 25 years of innovation can help your lending operation thrive today…and for the next 25.

At its first investor day in a decade and a half, the nation’s second-largest bank pegged its guidance for return on tangible common equity at a slightly higher level than what it reported last quarter. Not all investors were impressed.