VanEck Mortgage REIT Income ETF (ARCA: MORT)

VanEck Mortgage REIT Income ETF (ARCA:MORT), Top Holdings

VanEck Mortgage REIT Income ETF

VanEck Vectors Mortgage REIT Income ETF

Real Estate

Consumer Defensive

The fund normally invests at least 80% of its total assets in securities that comprise the funds benchmark index. The Mortgage REITs Index may include small-, medium- and large-capitalization companies. The fund is non-diversified.

Agnc Investment Corp.

Starwood Property Trust Inc

Rithm Capital Corp

Arbor Realty Trust Inc

Blackstone Mortgage Trust Inc

Ladder Capital

Hannon Armstrong Sustainable Infrastructure

Two Harbors Investment Corp.

Ready Capital Corp

xr:d:DAE9HpS4rJc:11789,j:6572294904333961230,t:24013020

Analyst Color

Equities

Mid Cap

REIT

Sector ETFs

Small Cap

Treasuries

Econ #s

Federal Reserve

ETFs

MORT

iShares FTSE NAREIT Mortgage PLUS Capped Index Fund

iShares FTSE NAREIT Residential PLUS Capped Index Fund

UWMC

Mortgage rates hit 1-year low, benefiting homebuyers &amp; existing homeowners. Goldman Sachs predicts higher home prices due to Fed rate cuts.

Mortgage Rates Fall To Lowest Level In Over A Year, Ease Pressure On Homebuyers: &#39;Good News For Home Price Appreciation&#39;

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Large Cap

COMP

LAND

OPEN

XLRE

Mortgage rates decline as investors expect federal funds rate cuts, but mortgage demand remains challenging. Lowest rates since February 2024.

Mortgage Rates Hit Lowest Point Since February As Investors Anticipate Fed Rate Cuts

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Macro Economic Events

Macro Notification

Bonds

Broad U.S. Equity ETFs

Specialty ETFs

Economics

SBAC

iShares Trust Barclays 20+ Year Treasury Bond Fund

Residential house prices reached record highs in April 2024, but growth slowed, possibly indicating normalization. All 20 largest US metros saw gains, led by San Diego&#39;s double-digit growth.

Home Prices Reach New Record Highs, Yet &#39;Signs Of Normalization&#39; Emerge

MORTGAGE ADVICE BUREAU by Mortgage Advice Bureau Holdings Ltd.

Mortgage Advice Bureau (Holdings) PLC

Mortgage Oil Corp

Mortgage rates fell to their lowest levels in over a year this week, spurred by rising market expectations of interest rate cuts by the Federal Reserve, bringing some much-needed <a href="https://www.benzinga.com/topic/real-estate-investing">relief to U.S. homebuyers.</a>
As of Aug. 7, the average 30-year fixed mortgage rate dropped by 26 basis points from the previous week, settling at 6.47%. This is the lowest rate since late May 2023, according to Freddie Mac data released on Thursday.
Similarly, the average 15-year fixed mortgage rate fell by 36 basis points from the previous week to 5.63%, the lowest level since April 2023.
&#8220;The decline in mortgage rates does increase prospective homebuyers' purchasing power and should begin to pique their interest in making a move,&#8221; Freddie Mac highlighted.
Additionally, this decrease in rates is already benefiting existing homeowners. The refinancing share of mortgage applications has climbed to nearly 42%, the highest since March 2022.
Read Also: <a href="https://www.benzinga.com/money/how-to-invest-in-real-estate">How To Invest in Real Estate In 2024</a>
<h3 class="wp-block-heading">Goldman Sachs Sees Home Prices Rising: Fed Rate Cuts Likely to Fuel Appreciation</h3>
&#8220;Bad news is (likely) good news for home price appreciation,&#8221; wrote Goldman Sachs analyst Vinay Viswanathan in a note Thursday, highlighting the investment bank&#8217;s optimistic outlook for the housing market.
Goldman Sachs has upwardly revised its forecasts for home price appreciation (HPA) in 2024 and 2025. The bank now expects full-year 2024 HPA to reach 4.5% and 2025 HPA to come in at 4.4%. These projections are notably higher than their previous forecasts of 4.2% and 3.2%, respectively.
The bullish outlook is underpinned by Goldman Sachs economists&#8217; prediction that the Federal Reserve will implement three rate cuts this year, each by 25 basis points. 
These anticipated cuts are expected to bring the 30-year conforming mortgage rate down to 6.5% by the end of 2024 and 6.1% by the end of 2025. These figures are slightly lower than the bank&#8217;s previous forecasts of 6.6% and 6.3%, respectively.
<h3 class="wp-block-heading">Mortgage-Linked Stocks Rally</h3>
The positive sentiment surrounding the recovery of the property market extended to mortgage-linked stocks. 
The iShares Residential and Multisector Real Estate ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/REZ#NYSE">REZ</a>), which tracks stocks exposed to the residential property market, rose 0.6% on Thursday. 
Other sector funds, such as the VanEck Mortgage REIT Income ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/MORT#NYSE">MORT</a>) and the iShares Mortgage Real Estate ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/REM#NYSE">REM</a>), saw gains of 0.9% and 0.8%, respectively.
Individual stocks in the mortgage business showed robust performance, with Rocket Companies Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/RKT#NYSE">RKT</a>) and UWM Holdings Corp. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/UWMC#NYSE">UWMC</a>) up by 3.3% and 4.5%, respectively.
Shares of companies involved in home construction also experienced a boost. The SPDR Homebuilders ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/XHB#NYSE">XHB</a>) climbed 1.6%.
Read now: 
<ul>
<li><a href="https://www.benzinga.com/markets/equities/24/08/40259139/tech-stocks-rally-after-5-day-slump-as-recession-panic-eases-nasdaq-100-movers-to-watch-thursday">Tech Stocks Rally After 5-Day Slump As Recession Panic Eases: Nasdaq 100 Movers To Watch Thursday</a></li>
</ul>
Photo: Shutterstock

Mortgage Rates Fall To Lowest Level In Over A Year, Ease Pressure On Homebuyers: 'Good News For Home Price Appreciation'

Mortgage rates are on a steady decline as investors have cemented expectations for upcoming reductions in the federal funds rate, yet mortgage demand continues to <a href="https://www.benzinga.com/topic/real-estate-investing">depict challenges among homebuyers. </a>
The Mortgage Bankers Association has reported Wednesday that the average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($766,550 or less) dropped by 5 basis points to 6.62% for the week ending July 19, 2024. 
This marks the lowest borrowing cost for home purchases since early February 2024.
Despite the decline in mortgage rates, long-term Treasury yields remained stable last week. The 30-year Treasury yield has held steady between 4.20% and 4.25% over the past week.
Market expectations for a 25 basis point rate cut in September hover at 100%, remaining unchanged from the previous week, according to the CME FedWatch Tool. 
<h3 class="wp-block-heading">Bumpy demand for mortgages</h3>
Despite the decline in mortgage rates, mortgage demand has shown some setbacks. While the <a href="https://www.benzinga.com/real-estate/reit/24/07/39816656/fed-rate-cut-expectations-drop-mortgage-rates-to-4-month-lows-surge-in-new-applications-refinanc">previous week&#8217;s drop in mortgage rates </a>spurred a sharp rise in new mortgage and refinancing applications, these trends were more subdued last week.
Mortgage applications fell by 2.2% week-over-week, while the refinance index edged up by 0.3% to 614.9, hitting the highest level since mid-August 2022.
On Tuesday, the National Association of Realtors reported a significant 5.4% decline in existing home sales for June. This drop is likely due to rising buyer apprehensions as median home prices reach new all-time highs. 
Jeffrey Roach, chief economist for LPL Financial, commented on the situation, stating, &#8220;The low supply of homes and high interest rates have depressed affordability to near-term lows. Because of the tight supply of homes available for sale, median prices continue to rise. We should not expect this dynamic to improve until mortgage rates drop and supply increases.&#8221;
<h3 class="wp-block-heading">Market Reactions</h3>
The Vanguard Real Estate ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VNQ#NYSE">VNQ</a>) was flat during the premarket trading session on Wednesday, following a 1% rise on Tuesday.
The SPDR Homebuilders ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/XHB#NYSE">XHB</a>) fell 0.5% at the time of this writing, while the VanEck Mortgage REIT Income ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/MORT#NYSE">MORT</a>) rose 0.5%. 
The worst performers in the premarket among real estate stocks were: 
<ul>
<li>Gladstone Land Corporation (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/LAND#NASDAQ">LAND</a>) down 3.96%.</li>
<li>Compass, Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/COMP#NYSE">COMP</a>) down 3.96%.</li>
<li>Service Properties Trust (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/SVC#NASDAQ">SVC</a>) down 3.47%.</li>
<li>Opendoor Technologies Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/OPEN#NASDAQ">OPEN</a>) down 2.71%.</li>
<li>Office Properties Income Trust (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/OPI#NASDAQ">OPI</a>) down 1.48%. </li>
</ul>
Read Next:
<ul>
<li><a href="https://www.benzinga.com/markets/24/07/39920377/us-home-sales-see-sharpest-monthly-decline-in-1-5-years-as-record-high-prices-keep-buyers-on-the-sid">US Home Sales See Sharpest Monthly Decline In 1.5 Years As Record High Prices Keep Buyers On The Sideline</a></li>
</ul>
Image created using artificial intelligence via Midjourney.

Residential house prices continued their upward trend, reaching new all-time highs in April 2024, yet the pace of growth has slowed, potentially suggesting<a href="https://www.benzinga.com/topic/housing-market"> early signs of normalization.</a>
The resilience of house prices was broad-based across the country, with all 20 of the largest U.S. metropolitan areas showing positive monthly increases. San Diego led the annual gains with double-digit growth.
<h3 class="wp-block-heading">April&#8217;s House Price Index: Key Highlights</h3>
<ul>
<li>U.S. house prices rose 0.2% month-over-month in April, up from a revised flat reading in March, according to the Federal Housing Finance Agency (FHFA) seasonally adjusted monthly House Price Index. This increase fell short of economist expectations of a 0.3% growth, as reported by Econoday.</li>
<li>House prices rose 6.3% from April 2023 to April 2024, slowing from the 6.7% year-over-year growth recorded in March 2024.</li>
<li>For the nine census divisions, seasonally adjusted monthly price changes from March 2024 to April 2024 ranged from -0.2% in the West South Central and Middle Atlantic divisions to +1.4% in the East South Central division. The 12-month changes were all positive, ranging from +3.0% in the West South Central division to +8.5% in the New England and Middle Atlantic divisions.</li>
</ul>
<h3 class="wp-block-heading">April&#8217;s S&amp;P CoreLogic Case-Shiller Index: Key Highlights</h3>
<ul>
<li>The 20-city S&amp;P CoreLogic Case-Shiller U.S. National Home Price Index reported a 7.2% seasonally unadjusted annual gain for April, down from a 7.4% annual gain in the previous month. This marks the first year-over-year deceleration in U.S. residential real estate prices, though it exceeded forecasts of 7% growth.</li>
<li>On a month-over-month basis, the 20-city index rose by 1.4%, slightly decelerating from March&#8217;s 1.6% increase.</li>
<li>San Diego continued to report the highest annual gain among the 20 cities in April, with a 10.3% increase, followed by New York and Chicago, with increases of 9.4% and 8.7%, respectively. Portland recorded the smallest year-over-year growth, with a 1.7% annual increase in April.</li>
</ul>
<h3 class="wp-block-heading">Economist Takes</h3>
"For the second consecutive month, we've seen our National Index jump at least 1% over its previous all-time high," Brian D. Luke, head of commodities, real &amp; digital assets at S&amp;P Dow Jones indices, said. 
Luke stated that 2024 was closely mirroring the strong start observed in the previous year. He mentioned that March and April had posted the largest rise, before a slowdown occurred in the summer and fall.
&#8220;Heading into summer, the market is at an all-time high, once again testing its resilience against the historically more active time of the year,&#8221; he added.
Luke also highlighted that 13 markets were currently at all-time highs, with San Diego leading once again, topping annual returns for the last six months.
A more cautious outlook came from Dr. Anju Vajja, deputy director for FHFA's Division of Research and Statistics, who noted that despite the rise in April, the appreciation rate slowed amid a slight rise in both mortgage rates and housing inventory. 
&#8220;The housing market in general began to show some signs of normalization,&#8221; she added.
<h3 class="wp-block-heading">Market Reactions</h3>
The housing data released Tuesday failed to trigger a positive reaction on real estate stocks, as hawkish Fed remarks pushed Treasury yields slightly higher. 
The&nbsp;Real Estate&nbsp;Select Sector SPDR Fund (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/XLRE#NYSE">XLRE</a>) was 0.9% lower at 09:05 a.m. in New York, eyeing its worst session in nearly a month. 
Both the Vanguard Real Estate ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VNQ#NYSE">VNQ</a>) and the iShares Residential and Multisector Real Estate ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/REZ#NYSE">REZ</a>) similarly fell 0.8%. 
The VanEck Mortgage REIT Income ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/MORT#NYSE">MORT</a>) showed more contained losses, down 0.3%. 
SBA Communications Corporation (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/SBAC#NASDAQ">SBAC</a>) and Weyerhaeuser Company (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/WY#NYSE">WY</a>) were the laggards within the XLRE ETF, both down 1.7%. 
The 30-year Treasury yield, a key benchmark for mortgage rates, rose by 2 basis points to 4.38%, sending the iShares 20+ Year Treasury Bond ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/TLT#NASDAQ">TLT</a>) down by 0.2%. 
Read now:<a href="https://www.benzinga.com/topic/real-estate-investing"> Popular Real Estate Investment Offerings – Start Generating Passive Income Through Real Estate</a>
Image generated using artificial intelligence via Midjourney.

Home Prices Reach New Record Highs, Yet 'Signs Of Normalization' Emerge

Mortgage applications in the U.S. saw an increase of 1.9% for the week ending May 17, continuing an upward trend following a 0.5% rise the previous week. This marks the third consecutive week of growth in mortgage demand, according to data released Wednesday from the <a href="https://www.benzinga.com/money/best-mortgage-lenders">Mortgage Bankers Association (MBA).</a>
The rise in applications aligns with a decrease in average mortgage rates, which reached a seven-week low due to expectations of lower inflation reducing long-dated Treasury yields.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($766,550 or less) decreased by 7 basis points to 7.01% during the week ending May 17, MBA data indicated. This decline, the third in a row, brought mortgage rates to their lowest level in over a month.
The yield on a 30-year Treasury bond, a critical indicator for mortgage rates, dropped by 8 basis points to 4.55% last week, following an inflation report for <a href="https://www.benzinga.com/general/macro-notification/24/05/38880563/disinflation-hopes-reshape-treasury-yields-major-trend-5-bond-etfs-poised-to-rally-on-">April that met expectations. </a>
Refinancing applications, which are highly sensitive to changes in interest rates, surged by 7%, building on a 5% increase the previous week. This significant rise in refinancing applications compensated for a 1% decline in mortgage applications for home purchases, reflecting ongoing challenges such as limited housing supply and intense market competition.
Chart: 30-Year Mortgage Rates Slow In Tandem With 30-Year Treasury Yields
<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="1024" height="495" src="https://editorial-assets.benzinga.com/wp-content/uploads/2024/05/22081130/image-93-1024x495.png" alt="" class="wp-image-349965" srcset="https://editorial-assets.benzinga.com/wp-content/uploads/2024/05/22081130/image-93-1024x495.png 1024w,https://editorial-assets.benzinga.com/wp-content/uploads/2024/05/22081130/image-93-300x145.png 300w,https://editorial-assets.benzinga.com/wp-content/uploads/2024/05/22081130/image-93-768x372.png 768w,https://editorial-assets.benzinga.com/wp-content/uploads/2024/05/22081130/image-93-1536x743.png 1536w,https://editorial-assets.benzinga.com/wp-content/uploads/2024/05/22081130/image-93.png 1920w" sizes="(max-width: 1024px) 100vw, 1024px" /></figure>
<h3 class="wp-block-heading">Mortgage-Linked Stocks On The Rise</h3>
The uptick in mortgage activity and the ease in mortgage rates have positively impacted stocks of mortgage-sensitive real estate firms in recent weeks. 
The iShares Mortgage Real Estate ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/REM#NYSE">REM</a>) is currently experiencing a five-week winning streak, its longest since January 2023.
Among the top-performing mortgage Real Estate Investment Trusts (REITs) over the past month are TPG RE Finance Trust, Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/TRTX#NYSE">TRTX</a>), Redwood Trust, Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/RWT#NYSE">RWT</a>), Invesco Mortgage Capital Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/IVR#NYSE">IVR</a>), and Arbor Realty Trust, Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/ABR#NYSE">ABR</a>), with gains ranging from 12% to 16%.
Read now: <a href="https://www.benzinga.com/analyst-ratings/analyst-color/24/05/38950144/amc-bonds-hold-gains-after-meme-stock-selloff-is-it-a-better-bet-than-buying-shares">AMC Bonds Hold Gains After Meme Stock Selloff: Is It A Better Bet Than Buying Shares?</a>
Image generated using artificial intelligence via Midjourney.

TRTX

Mortgage Applications Climb For Third Week As 30-Year Interest Rates Drop

Real stocks eke out gains as the sector gears up for changes

Chasing Goldilocks

August 2024 Active Management Insights: Positive Outlook For Cyclical And Value-Oriented Stocks

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