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Daily Rate Update: September 7th-10th

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Thursday – September 9, 2021

First-time unemployment claims fell to a post-shutdown low in the latest week as the sector continues to get back to full strength. At present, there are 11 million jobs available across the nation. The Bureau of Labor Statistics reports that Weekly Initial Jobless Claims fell 35,000 to 310,000 for the week ended August 28, 2021. To put it into perspective, the week of April 4, 2020 claims were over 6 million as the shutdowns took hold. Continuing claims, or those receiving benefits for at least two weeks straight, also fell to 2.783 million from 2.805 million. Many unemployed Americans should be able to go back to work as the enhanced unemployment benefits have expired in most states.

Home borrowing costs were unchanged this week and remain just above historic lows. Freddie Mac reports that the 30-year fixed-rate mortgage held at 2.88% with 0.7 in points and fees. The record low was 2.65% on January 7 of this year. Sam Khater, Freddie Mac’s Chief Economist said, “Mortgage rates dropped early this summer and have stayed steady despite increases in inflation caused by supply and demand imbalances. The net result for housing is that these low and stable rates allow consumers more time to find the homes they are looking to purchase.”

Courtesy of Mortgage Market Guide 

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Wednesday – September 8, 2021

Home borrowing costs were unchanged in the latest week and remain just above record lows. The Mortgage Bankers Association (MBA) reports that the 30-year fixed-rate mortgage held steady at 3.03% with 0.33 in points for the week ending September 3, 2021. Within the report it showed that the Market Composite Index fell 1.9%, the Refinance Index declined 3.0% while the Purchase Index was essentially unchanged. Mike Fratantoni, MBA’s Senior Vice President and Chief Economist said, “Economic data has sent mixed signals, with slower job growth but a further drop in the unemployment rate in August. We expect that further improvements will lead to a tapering of Fed MBS purchases by the end of the year, which should put some upward pressure on mortgage rates.”

The number of available jobs across the nation hit series high at the end of July, reports the Bureau of Labor Statistics. The JOLTS (Job Openings and Labor Turnover Summary) revealed a record 10.93 million jobs openings in the U.S. Job openings increased in several industries, with the largest increases in health care and social assistance (+294,000); finance and insurance (+116,000); and accommodation and food services (+115,000). The number of job openings increased in the Northeast, South, and West regions. With extended enhanced unemployment benefits having ended this week, the sector shall see if this translates into future job creation.

Courtesy of Mortgage Market Guide 

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Tuesday – September 7, 2021

The housing sector continues to see higher home prices due in part to heavy demand and low inventories. Fannie Mae reports that its Home Purchase Sentiment Index (HPSI) was essentially unchanged in August at 75.7. Three of the components were lower while three were higher. Consumers were slightly more optimistic about homebuying conditions for first time since March. The increase in optimism was driven partly by signs of moderation in home price expectations and continued low mortgage rates. “The HPSI remained relatively flat this month, suggesting to us that the continued strength of demand for housing and favorable home-selling conditions may be offsetting broader concerns about the Delta variant and inflation that have negatively impacted other consumer confidence indices,” said Mark Palim, Fannie Mae Vice President and Deputy Chief Economist.

After the weak read on August job growth was reported last Friday, U.S. stocks are lower today as the holiday shortened week kicks off. The Dow, S&P and NASDAQ recently closed at all-time highs led by strong earnings and the big surge in the tech sector. A healthy pullback or correction wouldn’t be out of the ordinary right now given the frothy levels. Or do stock prices just continue to grind higher on the notion the Fed will continue their expansionary policies. Time will tell.

Courtesy of Mortgage Market Guide 

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