Messy MBSs? Startup uses deep learning to predict mortgage-backed securities markets

As interest rates rise and house prices fall after a steady period of the opposite dynamic, investors are looking for more accurate ways to price these factors into the value of mortgage-backed securities.

While the globe bakes in record high temperatures, there’s one thing cooling down: the US housing market, where inflation and rising interest rates have led to a distinctly chillier climate.

In November, housing price data provider Zillow predicted write-downs of more than half a billion dollars on mortgage-backed securities (MBSs) it issued as a result of winding down its Zillow Offers house-flipping business, which overpaid for homes it expected to resell for a profit, at the same time that

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