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U.S. Market Recon – June 2017

Economy
Housing
The US economy grew in the past quarter, though not as strongly as it had previously. Unemployment continues to fall, with the headline rate ticking down to 4.3%. Workers’ earnings continue to rise, with average earnings climbing to $901/week. Rental vacancies are trying to escape their downward trend, with the national rate ticking up to 7.0%. Home ownership continues to fall, with the national rate declining to 64%. Home building applications are losing their upward momentum this month and quarterly housing prices continue to rise a further 0.8%. [Read more…] about U.S. Market Recon – June 2017

U.S. Market Recon – May 2017

Economy
Housing
The US economy grew in the past quarter, though not as strongly as it had previously. Unemployment continues to fall, with the headline rate ticking down to 4.4%. Workers’ earnings continue to rise, with average earnings climbing to $901/week. Rental vacancies are trying to escape their downward trend, with the national rate ticking up to 7.0%. Home ownership continues to fall, with the national rate declining to 64%. Home building applications continue to rise this month and quarterly housing prices continue to rise a further 0.8%. [Read more…] about U.S. Market Recon – May 2017

U.S. Market Recon – April 2017

Economy
Housing
The US economy grew in the past quarter, though not as strongly as it had previously. Unemployment continues to fall, with the headline rate ticking down to 4.5%. Workers’ earnings climbed to $897/week this month, though the long-term trend is negative. Rental vacancies are trying to escape their downward trend, with the national rate ticking up to 6.9%. Home ownership is trying to escape its downward trend, with the national rate climbing to 64%. Home building applications continue to rise this month and quarterly housing prices continue to rise a further 0.8%. [Read more…] about U.S. Market Recon – April 2017

To Yield or not to Yield?

Prepayment Penalty Choices in the Era of Rising Interest Rates

Most commercial mortgages, particularly fixed-rate mortgages, have some sort of prepayment penalty. Lenders impose such a penalty to earn back some, or all, of the interest income they would have earned had the mortgage remained outstanding for its entire term.

Prepayment penalties generally come in one of three flavors: [Read more…] about To Yield or not to Yield?