I’m not sure it’s worth mentioning at this point, but mortgage rates are still rising.
We’re into “What else is new?” territory with financing costs for large, half-million-dollar fiber cement cubicles. And you don’t need to be an industry expert or any kind of rates maven to extrapolate from recent turmoil at the long-end of the Treasury curve.
Still, it’s worth noting that on the MBA’s index, rates hit 7.41% this week, up 10bps and the highest since December of 2000. If you’re a late-twentysomething, 2000 might as well be 1890.
MBA VP Joel Kan stated the obvious: Treasury yields keep rising. He mentioned that damn dot plot. “Based on the FOMC’s most recent projections, rates are expected to be higher-for-longer, which drove the increase in Treasury yields,” he said.
Notably, rates for jumbo mortgages rose to 7.34%. That’s the highest in “history,” with the scare quotes to denote that the series only goes back to 2011.
The MBA update came a day after data suggested affordability concerns eroded demand for new construction in August, a notable development given the structural tailwinds for new homes. Separately (but relatedly), the Case-Shiller national price index hit a new record high.
The MBA’s mortgage applications gauge dropped this week, as did the purchase index. Both are loitering near multi-decade lows.
If you’re in the market, but aren’t sure whether to take the plunge on a $500,000 wooden box on a tiny lot in a cookie-cutter tract build, you can buy a caboose in Dahlonega, Georgia for just $41,900. It comes with an acre of riverfront property.
Frankly, considering the land, it might not be a bad deal, although I imagine flood risk could be high. Indeed, a permanent structure on the property would likely need to be on stilts, Jenna Ritter, of Virtual Properties Realty Biz, told Realtor.com.
“I really haven’t seen anything like this before,” she said, marveling at the novelty of an abandoned caboose. “It’s full-on primitive.”
There are, of course, “no utilities whatsoever,” and, as Ritter went on to explain, the caboose “hasn’t been used in quite some time, so the interior would need some investment.” Fortunately, “the price is reflective of that.”
It now costs nearly $50,000 to reenact Alexander Supertramp. And that’s considered a bargain.
I guess I am dating myself, but my first mortgage was a 1 year adjustable @ 14.5%. Luckily every time it reset it was a lower interest rate. I remember refinancing when it got to 9 with my confirmation bias I refinanced thinking it could never go lower.
I asked at the architecture studio lunch today what we all thought was ‘crazy high per sf.’ and figures like $400-500 were thrown around, now that’s exactly half of typical mid-to-high end commercial. Mix that with rates.. gulp
Interesting that your AI illustration seems to posit the Georgia caboose swamped not by swamp but by snow. Either that, or perhaps the AI got confused by your Alexander Supertramp reference and moved the caboose to Alaska.