Job Growth, Mortgage Rates, and the Housing Market

mortgage rates 4Job growth for December tracked along the same 150,000 gain (plus or minus) that we saw in October and November.  This is not enough to push down the unemployment rate but it does tell us that the economy continues to slowly improve.  Still, the slow growth of our economy makes the weak recovery susceptible to ‘winter colds’.  Any major shock could slow down growth. 

But the big news this week came from the Fed.  In the December meeting minutes some of the members indicated that “it would probably be appropriate to slow or to stop purchases well before the end of 2013.”  That means that some in the Fed want to stop buying mortgages sooner rather than later.  When the Fed stops buying, rates WILL go up.  That is what spooked the markets yesterday and caused rates to tick up a full ¼%.

Now rates will most likely settle back down a bit, but do you think some of your buyers will get off the fence when they see rates start to move?  I think they might. That would make for a terrific 2013.

This week Freddie Mac’s Primary Mortgage Market Survey for 30 year fixed rate loans  came in at 3.34 %  paying .7% in discount points – but remember, this was BEFORE yesterday’s rate bump.   Have a great weekend and have your buyers call us so we can get them approved to buy.

Stephan Akin
Sr. Loan Officer
NMLSR# 231112
Office: 214.987.9999
Fax: 866.728.6346

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