The Hudson Report (“THR”) is a bi-weekly summary powered by Hudson Realty Capital.
Rate Indications*
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Word Around Town
HUD Announces 2025 Income Limits, With Average Annual VLI Increase of 4.6%.On April 1, 2025, the U.S. Department of Housing and Urban Development (HUD) announced updated income limits used to determine eligibility for HUD-assisted housing programs and Low-Income Housing Tax Credit (LIHTC) properties. (Real full article here).
In Other News
Chart of the Week: MOVE Volatility Index and Mortgage-Treasury Spread (read full article here).
How Tariffs and Labor Shortages Will Thwart Housing Production (read full article here).
Did You Know?
HUD 221(d)(4) Loans are interest only during construction plus 2 months for cost certification followed by 40 years fully amortizing.
Hudson Highlights
Market Update
Market Disruption: Financial markets saw significant volatility following President Trump's announcement of broad-based tariffs—a 10% general duty on all imports and a steep 145% rate specifically on Chinese products. These aggressive trade measures rattled global markets and investor sentiment.
Federal Reserve Outlook: The Fed is navigating a complex backdrop. While some investors are hoping for rate cuts to buffer potential economic slowdown, policymakers like Minneapolis Fed President Neel Kashkari are urging caution, emphasizing that tariffs could elevate inflation and justify holding rates steady.
Market Reactions:
Currency Movements: The U.S. dollar dropped more than 4%, while the euro gained 2.8%. This unexpected shift points to a reallocation of capital away from U.S. assets, echoing patterns seen during past emerging market stress.
Bond Yields: Yields on U.S. Treasuries surged, with the 10-year climbing to 4.5%—its highest level since October 2024. The rise reflects weaker demand for government debt and may lead to higher borrowing costs.
Stock Market: Equity indices such as the S&P 500 and Dow Jones registered losses, reflecting concerns about the economic fallout from the new tariff regime.
Recent Economic Data:
Consumer Price Index (March): Edged down 0.1% year-over-year; annual inflation stands at 2.4%.
Producer Price Index (March): Declined 0.4%, indicating potential cooling in upstream price pressures.
Initial Jobless Claims (April 5): Held firm at 223,000, suggesting continued labor market resilience.
Our Commitment
Hudson Realty Capital strives to combine a responsive, hands-on approach to investment with a unique ability to quickly adapt to shifts in the market. While we have a new and refreshed look, our top-level client service remains the same.
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The Hudson Report and the news, information and observations stated herein are provided for informational and discussion purposes only and are not, and may not be relied on in any manner, as commitment or as legal, tax or investment advice. Hudson believes that the information provided herein is reliable but does not guarantee its accuracy or completeness and material aspects of information herein may change without notice. The interest rate indications set forth in The Hudson Report are estimates based on current market conditions. Final rates will be set at rate lock or at closing. The Hudson Report is not an offer or commitment to lend, and any such offer shall only be set forth in a signed, written commitment letter from Hudson. All transactions are contingent on satisfactory due diligence review and approval including evaluation of 3rd party reports, borrower credit, loan collateral and property, borrower and guarantor financials. Hudson is an Equal Opportunity Lender.
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