Employment Numbers & Real Estate Bubbles
By Winston Heverly, GRI, ABR, SFR, CDPE, CIAS, PA
(Coldwell Banker Access Realty)
RATES DROP ON DISAPPOINTING EMPLOYMENT NUMBERS Two-hundred thousand has been the magic number. If the economy could continually create 200,000 or-more new jobs per month, then it could withstand higher interest rates. September’ saw only 142,000 jobs created, the second-consecutive month of sub-200,000 job growth. Now, everyone is pointing to December. Fed Chair Janet Yellen has said a rate increase is still on the table this year. Traders are pricing fed funds rate futures contracts for a 36% chance of a rate increase in December. The recent drop in mortgage rates, combined with the TILA-RESPA regulatory change from October 3rd, have sent mortgage activity skyrocketing. Refinances were up 24%, and purchases were up 27%. Mortgage lending activity points to higher home sales for Septem...
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