“Better-than-expected PPI report reinforces upcoming mortgage rate cuts”

PPI refinance and rate Cuts we're going to talk about it all on today in [Music] mortgages hey what's up Dream Makers welcome back to the show we're talking about what's real what's hype and what you should actually be paying attention to out there in the world of mortgage and real estate news it's today in mortgage Rich how are you doing this is I'm doing good Michael glad you're back yeah thanks man I took a quick vacation at the end of summer kids are back in school as of yesterday and A lot's been happening this week also in the news we're going to talk about it today first thing I want to bring up rich PPI what do you make of it and what did we get yesterday well for us it ended up being better than expected the increase that we saw in inflation was more tied to the goods part of the goods and services part of PPI so it's definitely a good indicator for us and tell us why again we're obviously looking at this in relation to what the FED is trying to decide what to do coming in September well I mean it is one of the f most important reports when they're talking about their whole goal is to bring inflation down this is just one of the Matrix that they use actually it came below expectations of course we all want to see it even lower but overall I mean it was just a good report for them to say what they're doing is working and maybe we're at the point they need to Pivot and start to cut we'll see yeah one of the things rich I heard today was that uh we're at below 3% on inflation but uh two .9 is still almost 50% higher than the FED wants to see it and so when you think about it in that way it's kind of an interesting thing we've come so far but is it enough to kind of get more aggressive on rate Cuts we don't know we'll talk about that in a second but the next thing I wanted to mention is another stat that I heard in the wild today and this is from a report on NPR Marketplace that I heard is shelter inflation accounted for 90% of the Rises and prices in that recent in a recent report and so if if you remove Shelter From the CPI measure we would have been below 2% for the last six months and so that says a lot about how much we're paying for shelter right now yeah and you know there's really three components when they talk about shelter right it's rent it's owner equivalent of rent if they own their home and what they could rent it for and that is still really high listen part of rent is the cost of of owning that property by the owner right and part of that is interest rate that's just passed on to the people who live in those properties so rents are still high really high actually yeah it's a really tough Market out there we'll move on to the next point and that is that so now that we're kind of below that 3% inflation Mark for the first time since 2020 do you think that we are kind of in the market now where the fed's going to see this and be a little bit more aggressive or should we kind of think that this is going to be just Cal cool collected keep the steady course rate cut in September quarter percent what do we think depends on what but financial news you watch or read right overall it's coming down slowly and the fat is they're not just going to get aggressive we they there's no proof of that they've sown no signs of that um their language is changing a little bit just getting a little softer they're seeing Improvement they're seeing it but I I think we're going to get what we expect we're going to get 25 basis points cut on the you know from the fed Fed rate cut in September I think the chances are still super high for that 90 plus per. I mean just a few days ago 60% chance we're going to get a 50 base point cut but those odds are now way down you know to somewhere in the 20s so I don't think so I think I think the FED is going to give the market something and it's probably going to be 25 basis points just because there's so many economists saying they're just too aggressive and I just feel like the reports are saying hey maybe it is time let's test it out let's cut a little bit well we got a lot of time before the September meeting so we will certainly have time to see new data make new predictions and we're just going to have to see how things shake out but it's trending in the right direction like you said rich last thing I want to talk about right here is that in this article we pulled from CNBC today uh really in just the headline it says kind of what I want to talk about says mortgage refinancing surges 35% in one week week as interest rates hit lowest level in over a year uh Rich refinance coming back into our portfolio it's good thing right let's talk about that a little bit a big thing is credit card debt is through the roof right now with your average household they're sitting on so much Equity because of the price growth and so now they're looking at listen they're feeling a little more positive about where interest rates are heading they're sco lower and there's saying hey if I can save 1,000 bucks a month consolidating using the equity that I've earned in this property right now today even if the rate is 4% higher than maybe they're sitting on now at the end of the day I'm saving a th000 bucks a month that's $122,000 a year like who cares what the interest rate is at that point you're paying 29% on a credit card and that's what are you gonna do with that you you can't catch up so rich are we seeing most of that refinance Boom come from situations like this we we're probably not seeing a lot of you know pure rate reduction refinancing right there is some rate reductions very it's very limited you know some people did buy properties at the height they might be sitting at8 and a quarter inches rate and maybe they can get seven now and there is some significant savings there and maybe they're just like Hey listen uh if I continue to go and not make a move now it's costing me 200 bucks a month because I would save 200 if I did a refi today even though it's a rate I don't like but I'm still going to save 200 bucks and if the ROI on the cost of the loan makes sense they're moving on it uh but that's a small that's a small percentage when the rates were that High people were sitting they weren't doing much unless they had to buy and so there's still some of those out there but most of it is people leveraging their Equity lots of movement definitely out there in the marketplace on all three of these topics but it's interesting to look at and Rich obviously rates continue to come down there's going to be more and more opportunity there so as professionals we need to be paying attention this is not the time to check out and so coming back into the fall after a kind of a tough summer uh kids are back in school hopefully got more time paying attention to our database Rich how are we talking about this with our people that's it man we're just really putting our arms around our database our clients and reminding them of all the things like where rates are going how much you can save today if you refinance just communicating with our Borrowers and our and our you know they've trusted us with their purchase mortgage it's on us to help them in their refinance opportunities too so that's what we're doing we're just spending a lot of time just hugging on our clients that's what we're all about here is making sure that we are having that personal relationship with our clients obviously everyone that's bought a home anytime recently is getting calls off the hook from all those big companies trying to capitalize on that but we believe in that Personal Touch and coaching people through the right time to make those moves and so if you're like us and you're interested in being part of the best network in mortgages click the grow link below we'll show you all the information you need to know about what network is all about so rich any final words on any of these pieces today no I mean I it's all good news for us it's just we just want bigger bites at it you know like just give us more good news in bigger chunks is all we want you know that'll help rates come down quicker but we're progressing things are getting better does feel like it's going in the right direction getting better every day and so we're excited about that rich thanks so much for joining us today thanks everyone out there for watching and listening we appreciate you wherever you are and we will see you next time on today in [Music] [Applause] Mor for