Nov 2, 2011 | The Economy
Within the next 48 hours, mortgage rates may get bouncy. The Federal Open Market Committee will adjourn from a 2-day meeting and October’s Non-Farm Payrolls report is due for release.
Of the two market movers, it’s the Non-Farm Payrolls report that may cause the most damage. Rate shoppers across Massachusetts would do well to pay attention.
Published monthly, the “jobs report” provides sector-by-sector employment data from the month prior. It’s a product of the Bureau of Labor Statistics and includes the national Unemployment Rate.
In September, the economy added 103,000 jobs, and job creation from the two months prior was shown to be higher by 99,000 jobs higher than originally reported. This was a huge improvement over the initial August release which showed zero new jobs created.
When September’s jobs report was released, mortgage rates spiked. This is because of the correlation between jobs and the U.S. economy. There are a lot of economic “positives” when the U.S. workforce is growing.
- Consumer spending increases
- Governments start more projects
- Businesses make more investment
Each of these items leads to additional hiring, and the cycle continues. (more…)
Oct 13, 2011 | The Economy
The American Consumer is alive and well, it seems.
Friday morning, the Census Bureau will release its Retail Sales figures for September. The report is expected to show an increase in gross receipts for the 15th straight month with analysts predicting a 0.6 percent increase from August.
The projected increase represents the largest jump in Retail Sales in six months and would likely lead mortgage rates higher for buyers in Fitchburg and nationwide.
The connection between Retail Sales and mortgage rates is fairly straight-forward. Retail Sales are the majority component of “consumer spending” and consumer spending represents the majority of the U.S. economy — up to 70 percent, by some estimates.
And, as the economy goes, so go mortgage rates. (more…)
Oct 6, 2011 | The Economy
Mortgage rates are prepped to make big moves in the next 36 hours. Is it time for you to call in your rate lock?
Friday, at 8:30 AM ET, the Bureau of Labor Statistics will release the Non-Farm Payrolls report for September. Issued monthly, the “jobs report” offers sector-by-sector job creation figures from the month prior, and reports on the national Unemployment Rate.
Last month, exactly zero net new jobs were created, the government said. This month, economists expect a net 60,000 new jobs created.
Depending on where the actual monthly figure falls, FHA and conforming mortgage rates in Leominster may be volatile. The jobs reports tends to have out-sized influence on the mortgage bond market.
The connection between the jobs market and the mortgage market is fairly straight-forward. As jobs go, so goes the economy. This is because more working Americans leads to a stronger economic base.
- When more people work, consumer spending grows
- When more people work, governments collect more taxes
- When more people work, household savings increases
Each of these items are strengths to a recovering economy.
For rate shoppers, Friday’s job report could cause mortgage rates to rise — or fall. If the actual number of jobs created exceeded the 60,000 consensus estimate, look for mortgage rates to climb.
Conversely, if new jobs fell short of 60,000, expect that rates will drop.
Home affordability is at all-time highs because mortgage rates are at all-time lows. If you’re under contract for a home or looking to refinance, eliminate some of your interest rate risk. Lock ahead of Friday’s Non-Farm Payrolls release.
Get your rate lock in today.
Sep 9, 2011 | Buying Real Estate, Housing Analysis, Interesting Stuff, Selling Real Estate, The Economy
Home affordability slipped slightly last quarter, dragged down by rising mortgage rates and recovering home prices in Massachusetts and nationwide.
The National Association of Home Builders reports a Q2 2011 Home Opportunity Index reading of 72.6. This means that nearly 3 of 4 homes sold last quarter were affordable to households earning the national median income of $64,200.
Q2 2011 marks the 10th straight quarter — dating back to 2009 — in which the index surpassed 70.
Prior to 2009, the index had never crossed 70 even one time.
However, we must remember that the Home Affordability Index is a national survey. From region-to-region, and town-to-town, home affordability varied.
In the Midwest, for example, affordability was highest. 14 of the 15 most affordable markets nationwide were spread throughout Ohio, Michigan, Illinois and Indiana. Only Syracuse (#9) cracked the list from other regions.
The top 5 most affordable cities in Q2 2011 were: (more…)
Sep 7, 2011 | Buying Real Estate, Mortgage Lenders, Mortgage Rates, The Economy
The U.S. economy is no longer adding new jobs.
Last Friday, in its monthly Non-Farm Payrolls report, the Bureau of Labor Statistics reported that the U.S. economy added exactly zero new jobs in August as the national Unemployment Rate held steady at 9.1 percent.
Despite the “zero” reading, the jobs figures were in the red. This is because the BLS issued revisions to its June and July figures that adjusted the two months of data down by 58,000 jobs.
Economists had expected a monthly reading of +75,000. Their estimates missed.
The weaker-than-expected jobs data fueled a stock market sell-off that pushed stocks down 2.5% and spurred a bond market rally. (more…)
Sep 1, 2011 | Buying Real Estate, Interesting Stuff, Mortgage Rates, The Economy
If you’re shopping for a mortgage rate, today may be a good day to lock one down. That’s because Friday morning, the Bureau of Labor Statistics will release its Non-Farm Payrolls report for August 2011.
The “jobs report” tends to have a big influence on mortgage bonds and mortgage rates in Leominster.
The jobs report is a monthly issuance, providing sector-by-sector analysis of the U.S. workforce. It also report the national Unemployment Rate.
Wall Street expects the August Non-Farm Payrolls data to show 75,000 jobs created in August, down from 117,000 in July; and it expects that the Unemployment Rate will remain unchanged at 9.1%.
The jobs report’s connection to mortgage markets is straight-forward — as jobs go, so goes the economy. This is because when the number of working Americans rises :
- Consumer spending gets a boost
- Government tax collection gets a boost
- Household savings gets a boost
These are each good turns in a recovering economy. (more…)
