Survey levels are starting to catch up with the bond rally. Bankrate's 30-year reads 7.46% this morning, unchanged from Thursday and 4 bps under the 7.50% in yesterday's pulse, and 9 bps under the 7.55% it read a week ago. The 10-year Treasury closed Thursday at 5.10%, down 9 bps from Wednesday's 5.19% and 14 bps from 5.24% a week earlier, and is trading near 5.12% this morning. Freddie Mac's weekly PMMS held at 7.40% for the week of October 15, its first week without an increase after seven straight weekly climbs from 6.65%. Mortgage News Daily called the past five days the best directional run for rates in a long time and, in the same recap, cautioned against reading too much into it. The rally came despite hot CPI and PPI prints this week, not because of them.
Next up: September housing starts and permits on October 20, Freddie Mac's PMMS and weekly jobless claims on October 22, new home sales in the October 23 to 26 window, core PCE in the October 23 to 30 window, and the FOMC on October 27 to 28, a meeting with no dot plot. The 10-year's direction into the meeting is the thing to watch: a hold near 5.10% gives survey averages room to drift lower, and a reversal could take back this week's 11 bps off the high.
On range, 7.46% is still at the rich end. Bankrate's 30-day window runs 7.02% to 7.57% with a 7.34% average, and the 90-day window runs 6.61% to 7.57% with a 6.96% average, so today is 44 bps above where the 30-year sat a month ago and 50 bps above its 90-day average. The 30-year sits about 2.36 points over the 10-year, so the survey has passed through less of the week's Treasury rally (9 bps) than the 10-year itself gained (14 bps).
Today's lens is the VA gap. Bankrate's VA 30-year reads 7.18% against 7.46% conventional, 28 bps lower; its FHA 30-year reads 7.22%, though FHA's monthly mortgage insurance premium eats into that rate edge, so FHA needs an all-in comparison rather than a rate one. On a $400K loan, VA principal and interest runs about $2,710 a month against $2,786 conventional, $76 a month lower, and VA carries no monthly mortgage insurance (the funding fee is upfront and can be financed or waived for some veterans). Do this today: pull every active purchase file where the borrower may be VA-eligible but was quoted conventional, and send an all-in side-by-side before the weekend.