Why are home mortgage rates high compared to treasuries, and when will they fall?

 Bill Conerly explains why home mortgage rates are high compared to treasury rates and when they will eventually fall. According to the author, the current high mortgage rates are due to the imbalance in supply and demand for mortgage lending. The demand for home loans is high due to the current low-interest-rate environment and the availability of home loans. On the other hand, the supply of mortgage loans is constrained by the tight lending standards and lack of investment in the mortgage-backed securities market.

Furthermore, the article highlights that the Federal Reserve's policies are also contributing to the high mortgage rates. The author explains that the Fed's quantitative easing program has led to the low treasury rates, which in turn has made the mortgage lenders increase their rates to maintain their profitability.

The author predicts that the mortgage rates will fall as the lending standards are loosened, and more investors return to the mortgage-backed securities market. Additionally, as the Fed gradually reduces its bond-buying program, treasury rates are likely to increase, and mortgage lenders will be able to lower their rates.