If I remember right, it was PIMCO’s Gross who said that inflation was a full point higher than reported and that fed treasuries were the most overpriced investment today. Now morgage rates track 10yr treasuries, so if treasuries went from todays ~4% to say 5.5% (1% due to inflation, .5% for some kinda return) then prime rates which typically are 2% higher would be about 7.5%. Jumbos are about a full point higher if not more, would be hitting the 9% area.
I am not saying that would happen now. I kinda think there is still too much money going after too few investments. I think rates will keep bounceing around the 5.75-6.25 range for a long while. But I also think that the bias is up, not down.
