Daily Rate Update: October 1st-5th

posted in: Uncategorized | 0

Friday – October 5, 2018

And the survey says … 134,000 new jobs created in September, below the 184,000 expected. However, the Labor Department said, “Hurricane Florence affected parts of the East Coast during the September reference periods for the establishment and household surveys.” Average hourly earnings rose 0.3% from August to September, in line with estimates, while annual wage growth slipped to 2.8% from 2.9%. So, fears of higher wage growth were walked back a bit. The report was solid overall. July and August were revised higher by a total of 87,000, while the Unemployment Rate fell to 3.7%, the lowest reading since December 1969! After the job revisions, job gains have averaged 190,000 per month over the last three months.

Gas prices at the pumps have been on a steady rise over the past month as strengthening global economies see a pick up in demand for oil. As oil prices rise, gas prices usually follow them higher. The national average price for a regular gallon if gasoline rose to $2.91, the highest price since June. Some states are calling for a repeal in gas taxes that were enacted over the past few years.

Courtesy of Mortgage Market Guide

-CHECK US OUT ON SOCIAL-

Facebook

Twitter

YouTube

LinkedIn

Yelp


Thursday – October 4, 2018

Mortgage rates were unchanged early this week, reports Freddie Mac, though they did edge higher in the past few days. Freddie Mac reports that the 30-year fixed-rate mortgage was at 4.71% with an average 0.40 in points and fees. Rates have been trending higher in 2018 as the U.S. economy strengthens and employment hiring has been robust. Freddie Mac says that with mortgage rates expected to track higher, it’s going to be a challenge for the housing market to regain some of the momentum it has lost in the past six months.

With the holiday shopping season right around the corner, the National Retail Federation (NRF) has released its sales forecast for the November-December period. The NRF expects sales to grow between 4.3% and 4.8% from the last season total of $717.45 billion to $720.89 billion. The percentage is above the average annual increase of 3.9% over the past five years. “Our forecast reflects the overall strength of the industry,” NRF President and CEO Matthew Shay said. “Thanks to a healthy economy and strong consumer confidence, we believe that this holiday season will continue to reflect the growth we’ve seen over the past year.”

The government Jobs Report for September will be released on Friday morning where it is expected that U.S. employers added 184,000 new workers during the month. The jobs market continues to strengthen along with a robust economy. Most analysts feel that the labor market is at or just near full employment. Weekly Initial Jobless Claims were reported this morning and hover near 50-year lows.

Courtesy of Mortgage Market Guide

-CHECK US OUT ON SOCIAL-

Facebook

Twitter

YouTube

LinkedIn

Yelp


Wednesday – October 3, 2018

The service sector of the U.S. economy surged in September as the underlying index hit an all-time high due to respondents’ positive outlook on business and the current and future U.S. economy. The ISM Service Index hit 61.6 last month, the highest since the index was created in 2008, as it grew in September for the 104th consecutive month. The two key components of the report are new orders and employment, both of which increased during the month.

The labor market continues to strengthen as evidenced by the strong private payrolls report last month. ADP Private Payrolls rose by 230,000 in September, well above the 184,000 expected, while August was revised higher to 168,000 from 163,000. The service sector led the way with 184,000 jobs while the manufacturing sector added just 7,000, the lowest number in a year. “The labor market continues to impress,” said Ahu Yildirmaz, vice president and co-head of the ADP Research Institute. “Both the goods and services sectors soared. The professional and business services industry and construction served as key engines of growth.”

In a surprising turn of events, the owners of the remaining assets of Toys R Us are looking to restart the iconic brand loved over the years by children and many adults over the years. The 70 year old retailer shut down in June, costing 31,000 jobs across the country. The details of when we may see stores reopen have not been announced. Hopefully, we will hear something before the holiday shopping season.

Courtesy of Mortgage Market Guide

-CHECK US OUT ON SOCIAL-

Facebook

Twitter

YouTube

LinkedIn

Yelp


Tuesday – October 2, 2018

Home price gains slowed a bit in August but still produced solid increases year over year due in part to a strong job market and economy. CoreLogic reports that home prices, including distressed sales, rose 5.5% from August 2017 to August 2018. On a monthly basis, prices were up 0.1% from July to August. CoreLogic’s chief economist Frank Nothaft said, “National appreciation in August was the slowest in nearly two years, and we expect appreciation to slow further in the coming year.” CoreLogic is forecasting a 4.7% increase in home prices from August 2018 to August 2019.

Household debt across the U.S. reached a new peak in the second quarter of 2018 and has risen for the 16th straight quarter. The New York Federal Reserve reports that household debt increased by $82 billion to $13.28 trillion in the second quarter of 2018. Overall household debt is now 19.2% above the post-financial-crisis trough reached during the second quarter of 2013. Mortgage balances, the largest component of household debt, rose by $60 billion to $9 trillion. Student loan debt was essentially unchanged at $1.41 trillion, auto loan balances rose $9 billion to $1.24 trillion while credit card debt rose $14 billion to $829 billion.

Bank of America Merrill Lynch reported on Monday that existing home sales, the largest segment of the housing market, may have peaked and have failed to break above the 5.72 million annual units hit in November of 2017. The report said that rising mortgage rates and higher home prices are reasons for the decline. The latest reading on existing home sales for August was 5.34 million units.

Courtesy of Mortgage Market Guide

-CHECK US OUT ON SOCIAL-

Facebook

Twitter

YouTube

LinkedIn

Yelp


Monday – October 1, 2018

The U.S., Canada and Mexico struck a new trade deal called the U.S.-Mexico-Canada-Agreement (USMCA), which replaces NAFTA, last night. As a result, U.S. Stocks are surging and hovering near all-time record highs. The $1.2 trillion open trade zone agreement was on the brink of collapse recently, until the three countries agreed on the deal last night. The U.S. is still trying to hammer out trade issues with China where talks are still ongoing.

Real estate brokerage firm Redfin reports that the share of homes selling above list price just dropped below 2016 levels. For the week ended September 25, Redfin reports that 22.9% of homes sold above their asking price. For the same period last year, 25.5% of homes sold above their asking price. Redfin went on to say that the share of homes that sold above list hasn’t been this low since 2016 and the number has been declining since its peak of 29% this past June.

Two key labor market reports will be released this week in Wednesday’s ADP Private Payrolls Report and Friday’s Non-Farm Payrolls Report. The labor market has been a source of strength for the U.S. economy in recent years and has kept up a robust pace in 2018. The recent report for August showed payroll gains of 201,000 while wage growth hit 2.9%, the largest annual increase since 2009. Total unemployment, measured by the U6 number, hit 7.4%, the lowest since April 2001.

Courtesy of Mortgage Market Guide

-CHECK US OUT ON SOCIAL-

Facebook

Twitter

YouTube

LinkedIn

Yelp