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Jobs Report Breakdown

On Friday last week the Bureau of Labor Statistics (BLS) released their Jobs Report numbers and they showed that there were 1.8 million jobs added in the month of July in the US.  This number came in hotter than the expected 1.5 million jobs.  The unemployment rate, which is also part of this report, showed that it improved by 0.9% dropping from 11.1% to 10.2%.  This number also came in stronger than expectations, beating its estimates of 10.5%.  Here is what they said, “Household survey interviewers have been instructed to classify employed persons absent from work due to temporary, coronavirus-related business closures or cutbacks as unemployed on temporary layoff. BLS and Census Bureau analyses of the underlying data suggest that this group still may include some workers affected by the pandemic who should have been classified as unemployed on temporary layoff.”  

Also, some experts are saying that the unemployment rate is not correctly accounted for because groups of people labeled “not actively seeking work” are not included in the unemployed total amount.  This group is roughly 7.7 million people and should be included, which would bring the real unemployment rate closer to 15%.  Lastly, average hourly earnings increased slightly by 4.8% when comparing earnings to last year’s numbers. 

Overall, this was a stronger report, and hopefully the economy will continue to improve and work its way out of this Covid quagmire.

Sources: https://bit.ly/3a5rH4e

Call your Advisors Mortgage Loan Officer today to discuss the current market in more detail and to learn what you qualify for.


Pending Home Sales Surge in June

According to the National Association of Realtors (NAR), pending home sales, which represents signed contracts on existing homes, rose 16.6% in June.  This surge represents the second consecutive month of double-digit gains.  NAR’s Chief Economist, Lawrence Yun stated, “It is quite surprising and remarkable that, in the midst of a global pandemic, contract activity for home purchases is higher compared to one year ago.”  Yun also pointed out that, “Consumers are taking advantage of record-low mortgage rates resulting from the Federal Reserve’s maximum liquidity monetary policy.”  The NAR is expecting these record low interest rates to remain for the next eighteen months!

A breakdown by region has the Northeast leading the way with a 54.4% monthly increase in pending sales, the Midwest at 12.2%, the South at 11.9%, and West at 11.7%.  Overall, the Northeast’s impressive increase may be attributed to a longer lockdown versus the other regions. 

Sources:

https://cnb.cx/39SItn0

https://bit.ly/3fiAj8A

Call your Advisors Mortgage Loan Officer today to discuss the current market in more detail and to learn what you qualify for.


Resilient Housing Market

Signed contracts on new homes were up 13.8% for the month of June.  This is a very large increase and much stronger than the estimated 4%.  Adding in June’s demand, annual sales are up 7%.  Median home pricing for the year has increased by 5.8% to $329,300.  This was a very strong report, and proves that the housing market is very resilient and strong, especially when analyzing the new construction home sector.

Another strong housing report was released last week by the Federal Housing Finance Agency.  Their Home Price Index showed that home prices fell in May slightly by 0.3%, but are still up by 4.9% since May of 2019.  This data is slightly lagging as it’s from May, plus it only analyzes data on single-family homes with conforming loan amounts.  Despite these facts, it still shows strength as home pricing is still on the rise.

Lastly, the strongest of the reports, Existing Home Sales, showed that sales on already-built or “existing” homes, increased by a whopping 20.7% for the month of June.  This was the largest one month jump ever.  Last year’s numbers showed that sales were down 27% at the time, further reflecting the massive improvement we’re seeing this year.  Also, inventory numbers were down by 18.2% for the month, which makes you wonder, if there were more homes available for sale, would these numbers be even stronger?

As seen in each of these reports, the housing market is very resilient and demand for homes is still very strong.

Sources: 

http://bit.ly/2MJU6mf

https://bit.ly/3f4R6fl

http://bit.ly/2sq38xg


Home Prices Continue to Rise and New Home Sales Skyrocket

According to the latest Radian Home Price Index data, home prices across the US grew at an annualized rate of 6.3% over the first half of this year.  In addition, from July 2019 to June 2020, home prices have increased 8.1%, which is an increase over last month’s 7.8% year over year recording.  The uptick from last month is a welcome sign and is an indicator that home price gains are gaining momentum despite all of the challenges presented for home buying and selling during a global pandemic. 

The demand for newly built homes also continues to increase.  Sales of newly built homes jumped 55% annually in June, according to a monthly survey by John Burns Real Estate Consulting.  This large move represents the highest pace of growth sales since the height of the housing boom in 2005.  Sales of new homes were the strongest in the Northeast, with an 86% annual jump, followed by Florida, which saw an 84% jump. 

Both reports are strong indicators that the housing market is as strong as ever and is resistant to the challenges presented during the COVID-19 crisis. 

Call your Advisors Mortgage Loan Officer today to discuss the current market in more detail and to learn what you qualify for.

Sources:

https://bit.ly/3hcuPNU

https://cnb.cx/2WARyeU


Jobless Claims Slowing Down and Mortgage Volume Up

Last week initial jobless claims came in at 1.314 million.  This shows the number of individuals who claimed or filed for unemployment for the first time.  It came in better than the expectations of 1.4 million and was slightly lower than last week’s number of 1.413 million.  Continuing claims, which measures individuals who “continued” their file of unemployment, improved rather significantly from 18.76 million to 18.06 million.  This was one of the first very meaningful unemployment improvements in a long time, and may be pointing to a recovery. This is, however, a lagging indicator, so we will continue to monitor it closely. 

On the mortgage front, the Mortgage Bankers Association released their application data, and it showed that overall mortgage volume was up by 2.2% for the week of the 29th.  Purchase applications are up by 5% and year-over-year they are up 33%.  Refinances are up by 0.2% for the week and up by 111% compared to last year.   Also, it is important to know that refinances made up about 60% of all mortgage transactions as interest rates are at historically low levels.

As individuals get back to work and businesses reopen, we are poised for a very active and healthy housing market.  The stage is set with home buyer demand at record levels and historically low interest rates. 

 

Sources:

 

https://bit.ly/2BQGQd4

https://bit.ly/2C0LViX

 


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