Mortgage News in the Carolinas
Posts tagged Non-Farm Payrolls
Homes Get More Affordable On March Jobs Data
040 days
by Geoff Brown
in The Economy
Americans continue to get back to work.
Last Friday, in its Non-Farm Payrolls report for the month of March, the Bureau of Labor Statistics announced 120,000 net new jobs created, plus combined revisions in the January and February reports of +4,000 jobs.
The March report marks the 18th straight month of job growth nationwide — the first time that’s happened in 5 years.
The Unemployment Rate dipped in March, too, falling one-tenth of one percent to 8.2%. This is its lowest national Unemployment Rate since February 2009.
Clearly, the jobs market is moving in the right direction. Yet, after the Non-Farm Payrolls report was released Friday morning, stock markets dropped and bond markets gained — the opposite of what a casual market observer would expect.
It happened because, although job growth was strong, Wall Street decided it just wasn’t strong enough. The market expected 200,000 jobs created in March at least and the actual reported figure fell short.
Lucky for you, Wall Street’s pain is Main Street’s gain. After the jobs report was released, mortgage rates immediately dropped to a 3-week low, making homes more affordable in Carolinas and throughout all 50 states.
The market’s reaction is an excellent example of how important jobs data can be to home affordability — especially in a recovering economy.
The economy shed 7 million jobs between 2008-2009 and has since added more than half of them back. Wall Street pays close attention to job creation because more working Americans means more consumer spending, and more consumer spending means more economic growth.
Rate shoppers caught a bit of a break on the March payroll data. By all accounts, the labor market recovery in underway and, as it improves, higher mortgage rates are likely nationwide. For now, though, there’s a window for low mortgage rates that buyers and would-be refinancing households can try to exploit.
If you’re actively shopping for a home or a mortgage, today’s mortgage rates may be at “last chance”-like levels. Once rates rise, they’re expected to rise for good.
Jobs Report Due Friday; Mortgage Rates Expected To Change
045 days
by Geoff Brown
in The Economy
If you’re out shopping for a home this week, or trying to lock a mortgage rate, with Friday comes home affordability risk. Consider locking your mortgage rate today.
The March Non-Farm Payrolls report is due for release Friday morning and mortgage rates are expected to move. Unfortunately for the home buyers and rate shoppers of Charlotte , we can’t know in which direction that will be.
The prudent play may be to lock your mortgage rate today.
On the first Friday of each month, the Bureau of Labor Statistics releases its Non-Farm Payrolls report. More commonly called “the jobs report”, the release is a bona fide market-mover, month after month.
Depending on how the March jobs data reads, FHA and conforming mortgage rates could rise — or fall — by a measurable amount post-release. This is because today’s mortgage market is closely tied to the economy, and the economy is closely tied to job growth.
The connection between jobs and mortgage rates is basic.
More workers leads to higher levels of consumer spending nationwide and consumer spending accounts for the majority of the U.S. economy.
In addition, when more workers are paid, more taxes are paid, too. Local, state and federal governments collect more monies when payrolls are rising which, in turn, benefits projects that purchase new goods and services, and, in many cases, results in the hiring of additional personnel.
Job creation can be a powerful, self-reinforcing cycle.
Between 2008 and 2009, the economy shed 7 million jobs. It has since recovered half of them. Friday, analysts expect to count another 200,000 jobs created. If the actual number of jobs created exceeds estimates, look for stock markets to gain and bond markets to lose. This leads to higher mortgage rates — especially with the Federal Reserve zeroed in on the labor market.
If the actual number of jobs created in March falls short of expectations, however, mortgage rates may fall.
Unfortunately, by the time the report is released, it will be too late to act on it. The release is made at 8:30 AM ET and bond markets are closed for Good Friday.
Mortgage Rates Expected To Rise On A Strong Job Report
073 days
by Geoff Brown
in The Economy
With home affordability at an all-time high, buoyed by the lowest mortgage rates ever, it’s been a terrific time to buy or refinance a home using a mortgage.
The good times may not last, though, so today marks an ideal time to lock a mortgage rate. Friday brings risk. Here’s why.
Since 2010, weak economic conditions have been a primary catalyst for low mortgage rates in Carolinas. Over the last 12 months, though, manufacturing output has been rising, consumer spending has been climbing, and business investment has increasing.
In other words, the economy is improving. However, it’s the jobs market that’s believed to be the economic recovery keystone. When jobs come back, analysts say, so does the economy.
Assuming that’s true, a recovery may already be well underway.
According to the Bureau of Labor Statistics, the U.S. jobs market has grown for 16 straight months now, adding 2.5 million net new jobs along the way. It’s one reason why the February jobs report matters so much to housing.
Rate shoppers would do well to pay attention.
Friday, at 8:30 AM ET, the government will release its Non-Farm Payrolls report for February. Wall Street expects the report to show 210,000 new jobs were created in February, a figure slightly higher than the rolling, 6-month average for job growth. This would be a positive economic indicator.
If the analysts are correct, mortgage rates are likely to rise on the news, harming home affordability.
Furthermore, affordability could be harmed by a lot if the number of net new jobs created exceeds the 210,000 tally expected. It’s not a far-fetched scenario. Wall Street’s “whispers” put the actual jobs figure somewhere between 250,000-300,000. A reading lije this would cause mortgage rates to spike and would add money to a prospective monthly mortgage payment.
If the idea of rising mortgage rates makes you nervous, consider taking your nerves out of the equation. Call your loan officer today. Lock your rate ahead of Friday’s Non-Farm Payrolls release.
Friday’s Jobs Report Represents A Big Risk To Low Mortgage Rates
0171 days
by Geoff Brown
in The Economy
Have you been floating a mortgage rate? It may be time to lock.
At 8:30 AM ET Friday, the government’s Bureau of Labor Statistics will release its November Non-Farm Payrolls report. Better known as “the jobs report”, the monthly Non-Farm Payrolls figures provide sector-by-sector employment data, and tally the size of the current U.S. workforce size.
From these two elements, the national Unemployment Rate is derived.
Since topping out at 10.2% in October 2009, the Unemployment Rate has dropped to 9.0%. More than 2.3 million net new jobs have been made in the last 24 months.
Wall Street expect to see 125,000 more jobs added in November.
Depending on how closely the actual Non-Farm Payrolls data meets Wall Street expectations, Charlotte rate shoppers could find that the mortgage market landscape has shifted beneath them. The jobs report is a mortgage-market catalyst and when its reported value differs from Wall Street expectations, the impact on mortgage rates can be palpable — especially in a recovering economy.
The connection between the jobs market and the mortgage market is straight-forward — as the jobs market goes, so goes the economy.
- When more people work, consumer spending increases
- When consumer spending rises, businesses expand and invest
- When businesses expand and invest, more people are put to work
Furthermore, employees and employers both pay taxes to governments. With more tax revenue, governments embark upon new projects which (1) require the hiring of additional workers, and (2) require the purchase and/or repair of additional equipment and supplies.
Employment can be a self-reinforcing cycle for the economy and that’s why Friday’s jobs report will be so closely watched. If the number of jobs created exceeds the 125,000 expected, mortgage rates will rise on the expectation for a stronger U.S. economy in 2012.
Conversely, if the jobs figures fall short, mortgage rates may fall.
Mortgage rates continue to hover near all-time lows according to Freddie Mac’s weekly Primary Mortgage Market Survey.
If you’re under contract for a home or looking to refinance, minimize your interest rate risk. Lock ahead of Friday’s Non-Farm Payrolls release.
