Why 2027 Could Be the Year to Start Building Now

Mortgage Rates, AI Investment, and Preparing for 2027 The mortgage market is facing persistent pressure from elevated Treasury yields, strong economic activity, oil and diesel prices, and competition for capital from the massive AI buildout. From Austin, Texas, KP breaks down the latest forces shaping mortgage rates and explains why lenders should use the slower season to retool, explore alternative products, and prepare for the opportunities ahead. KP starts by putting the current market into perspective, discussing the autumnal equinox, the changing conference season, and why sometimes it helps to zoom out when the daily challenges of the market begin to feel overwhelming. He also highlights the activity at Mortgage Collaborative, including discussions around non-QM, construction lending, equity lending, FICO modernization, capital markets, and marketing. The conversation then turns to the outlook for 2027. KP explains why lenders should not give up on today's market but should instead use the slower months to strengthen their product offerings and prepare for the next spring purchase season. He emphasizes the importance of continuing to grind while borrowers and the broader market enter a slower period. KP also examines the flow of money and its impact on Treasury yields and mortgage rates. He discusses the enormous investment required for AI infrastructure and data centers, including the competition between capital flowing into AI-related investments and capital needed to fund U.S. government debt. The episode also explores oil and diesel prices, the ongoing conflict involving Iran and the Strait of Hormuz, economic growth, employment, inflation, and the potential impact of changing energy prices on Treasury yields and interest rates. KP explains why the eventual resolution of the conflict could create significant changes in bond markets and interest rates. Episode Highlights: 00:00 – Building for 2027 during a challenging market 00:26 – KP reports from Austin, Texas 00:51 – Putting the mortgage market into perspective 01:20 – The scale of the universe and why perspective matters 02:00 – The autumnal equinox and changing market sentiment 02:40 – Persistent higher rates and the Fed 03:05 – Mortgage Collaborative and alternative lending products 03:20 – FICO modernization and industry working groups 03:40 – Why lenders should start building for 2027 04:00 – The transformation of Austin's Rainey Street 04:20 – Construction, real estate, and thinking ahead 04:40 – Mortgage Collaborative, MBA, and AIME Fuse 05:03 – Peer Group Review and sharing lender data 05:40 – Treasury yields and preparing for next year's purchase season 06:00 – Non-QM, equity lending, and retooling the mortgage business 06:20 – The timing of the next spring purchase season 06:40 – The flow of money and its impact on mortgage rates 07:00 – AI investment and the data-center buildout 07:20 – $500 billion in AI investment competing for capital 07:40 – Treasury yields and government borrowing 08:00 – Oil, diesel prices, and interest rates 08:11 – Iran, the Strait of Hormuz, and market uncertainty 08:40 – Oil demand, diesel, and global commerce 08:57 – PMI data and the strength of the economy 09:00 – Employment, economic growth, and interest rates 09:16 – What could happen when the Iran conflict ends 09:40 – Oil supply chains and bond-market uncertainty 10:00 – Inflation, PCE, CPI, and the path forward 10:20 – Why the market may still have a difficult stretch ahead 10:40 – Looking beyond 2028 and preparing for what's next KP takes a closer look at the forces shaping mortgage rates, Treasury yields, capital flows, AI investment, energy prices, inflation, and the housing market. From Austin and the Mortgage Collaborative to the upcoming 2027 purchase season, this episode highlights why mortgage professionals should stay focused on today's market while building the tools, products, and strategies needed for what comes next. Follow for more updates: https://linktr.ee/kptalksdollarsandsense #MortgageRates #MortgageMarket #HousingMarket #InterestRates #TreasuryYields #FederalReserve #Inflation #Economy #MortgageLending #NonQM #EquityLending #ConstructionLending #FICO #AI #ArtificialIntelligence #DataCenters #OilPrices #Diesel #BondMarket #EconomicData #Housing #KPTalksDollarsAndSense