Mortgage Market Update
While this weeks mortgage rates remain low, it is important to know that the recent employment news may result in an overall uptick in mortgage rates over the coming months. This week, there was a host of good economic news, with gold prices hitting levels not seen since last November, Spain saying they will not request additional aid and the European Central Bank (ECB) holding their rates steady. The mortgage market update was dramatic with constant changes daily.
Bond sales continue
Let’s not forget that the Fed is still running their $40 billion mortgage bond buyback program which was designed to help keep mortgage rates low. Housing starts for August were low but prices went up for new homes. This news offers mixed reviews for those who are buying a home but great news for homeowner’s who have suffered under declining prices.
About the jobless rates
In spite of the various conspiracy theories about the jobless rate dropping to 7.8 percent, there are some very sound reasons why the jobless rate improved three-tenths of a percent. For starters, the two prior jobless reports showed an increase in the number of jobs provided. July and August numbers were adjusted upwards by the Bureau of Labor Statistics (BLS) resulting in an increase of 86,000 new jobs above what was previously reported. Keep in mind, that three-tenths of a percent is quite low by nearly any standards. ADP (payroll company) reported similar findings in their reporting; their small business reporting showed slightly over 81,000 jobs in small business. Overall, there are some concerns with the trajectory of the job market as many of the new jobs reported were part time. The upside is that fewer workers seem to be abandoning their job search.
While interest rates are currently low, Core Mortgage Financial also understands that consumers are not feeling as optimistic as they could be. Fortunately, the better job numbers may provide that phycological boost needed by consumers to get them spending again. Keep in mind that we are now entering the holiday season where certain sectors of the market will be on the increase. While retail sales will be on everyone’s minds, the housing sector is likely to see fewer sales during this time. If you’re considering the possibility of refinancing, it may be a good time to start searching for the best refinancing rates now. If the job picture continues to improve, chances are that you won’t find lower rates by waiting.