Each month, we bring you insights from one of the best in the business — Zack Diener of Barrett Financial Group, LLC — to help you stay informed and make confident, well-timed decisions in today’s ever-changing mortgage landscape.
Approaching Long-Term Lows
We have exciting news to share: mortgage rates are now approaching levels we haven’t seen since last October. As conventional 30-year fixed rates have moved into the low 6.1% range, we’re entering a zone where rates can see larger than normal movement – and most of that movement has been downward.
Today’s 30-year fixed rate is at 6.27%, continuing a remarkable downward trend that has played out over the past several weeks. If you’ve been paying attention to our previous updates, you’ll recall that we started the year in the high 6% to low 7% range. The improvement since then has been substantial.
The Story Behind Recent Rate Movement
October has been an interesting month for mortgage rates, with several key developments moving the needle:
Tariff News and Bond Market Reaction: When Trump announced he was calculating a massive increase in Chinese tariffs and canceling a scheduled meeting with China’s President Xi, the stock market immediately moved lower and bonds rallied. This bond rally translated into mortgage rates seeing their biggest day-over-day decline in several weeks, bringing rates to levels not seen since the September Fed meeting.
This might seem counterintuitive – tariff announcements causing rates to drop? – but it illustrates how complex market dynamics work. Higher tariffs can slow economic growth, which actually reduces inflation pressure and supports lower interest rates.
Employment Data Speaks Volumes: When the ADP Employment report showed the job count dropping by 32,000 (well short of the forecast for a 50,000 increase), with the previous month revised down to -3,000, bonds responded immediately and moved in line with stronger levels. This weakness in employment data provided support for mortgage rates to remain at favorable levels.
Sideways Movement in a Narrow Range: Over the past several weeks, rates have been relatively flat with each day during this stretch falling inside a narrow range between 6.31 and 6.39%. The range has gradually shifted lower, but day-to-day volatility has been minimal. This stability has been welcome after the volatility we experienced earlier in the fall.
Government Shutdown Impact
The government shutdown that occurred in early October created an unusual situation. With the Federal government closed and no economic data reported, the market was flying blind until data eventually returned when government funding resumed. The shutdown delayed the monthly jobs report – typically the most important economic event for mortgage rates – creating additional uncertainty.
Local Market Perspective
Here in Hawaii, our local banks and Hawaii-based credit unions continue to reflect these favorable national trends. The expertise our Hawaii-based lenders bring to island real estate transactions becomes increasingly valuable when navigating this dynamic rate environment. They understand the complexities of properties across our islands and can help secure financing during these improved rate conditions.
As a local mortgage brokerage with longstanding partnerships with both local and mainland institutions, we continue to find the best available par rates at any given moment.
What This Means for Borrowers
The Opportunity is Real: As rates approach long-term lows not seen since last October, we’re in a zone where they can slip quickly in either direction. The question now is whether we continue moving lower or see a bounce higher.
Act During Windows of Opportunity: The employment data showing labor market weakness has been the primary force keeping rates low. As long as economic data continues to show softening, rates should remain in this favorable range. But the slightest sign of stronger-than-expected data could reverse the trend.
Narrow Range is Stabilizing: While the narrow range of 6.31-6.39% might seem restrictive, it actually represents stability after months of volatility. For borrowers, this means rates are unlikely to spike dramatically in the near term, but also that waiting for significantly lower rates may be futile.
The Bottom Line: If you’ve been waiting for rates to approach last year’s levels before taking action, that moment has arrived. Whether you’re buying, refinancing, or considering an investment property, the current rate environment represents one of the best opportunities we’ve seen all year.
The mortgage market continues to remind us that timing perfect lows is impossible, but recognizing good opportunities when they arrive is essential for successful home financing.
Mortgage insights provided by Zack Diener, Barrett Financial Group
Zack Diener
Mortgage Loan Originator | NMLS 470413
Based in Fort Collins, CO
Serving Colorado and Hawaii
(808) 349-3777 phone
(800) 385-3630 fax
ZDiener@barrettfinancial.com
Barrett Financial Group, LLC | Corp NMLS #181106
275 E Rivulon Blvd, Suite 200, Gilbert, AZ 85297
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