The author of “How to Change” Katy Milkman explains that leaving yourself wiggle room on your goals to avoid the “What-the-hell” effect (scientific term)… ‘I already broke my diet today, it’s just one more cookie, what the hell?’ Research shows that if you set a goal of running 7 days a week and give yourself 2 free passes, you are more likely to run 5 days a week than if you set a goal for 5 days.

Rates increased this week as unemployment decreased and inflation numbers continue to rise. Additionally the Fed minutes showed they would taper their purchasing of MBS faster than expected. Interest rates are up approximately 5/8% from this time last year.


Jobs Report – wage inflation continues to push higher, average weekly & hourly earnings are up about 4.7% year over year and is on pace for 6% growth if you annualize over 6 months. You have to go back to the 1990’s to see 6% wage growth – we’ll see if we reach that level. The labor market remains tight.

Home Values increased another 1.3% from November to December showing 18% growth in 2021. Core Logic expects only 3% growth in 2022 but their calls have been way off over the last year

Fed minutes were released from their Dec. 15th meeting and there was surprise information showing how rapidly they would reduce their purchase of MBS. The market now estimates a 76% chance the first rate hike will happen in March. The minutes also noted that after tapering and hiking rates they will reduce their $8.8T balance sheet of MBS and Treasuries relatively quickly. Last time they went through tightening they waited 2 years after their rate hike to reduce their balance sheet – this round might be closer to 2-4 months (April or June).

Mortgage Applications to purchase homes are down 4% from the previous week and 12% on a year over year basis. Refinances are down 2% from the previous week and down 40% year over year.

Happy New Year! Thank you to my fantastic clients and referral partners. In 2021 it was an honor to help over 80 families with home loans. 73.5% of these transactions were purchases! Coincidentally 56.6% of my business this year came from partner and client referrals, thank you very much for your recommendations I’m very pleased to pass 175 Reviews with an average of 4.97 stars!

Here’s a quick review of 2021 and some things we look forward to in 2022.

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