Job Market Trends, Home Prices, and Mortgage Rate Outlook | September 2024



As we review the past week, several key economic indicators have provided a mixed picture of the labor market and housing sector. The outlook for mortgage rates in the coming week remains uncertain, with potential for fluctuations based on these recent developments. Here’s a detailed look at what happened:

Current Outlook on Mortgage Rates

Given the latest economic data, mortgage rates could see some movement this week. The Federal Reserve’s expected rate cut, influenced by slower job growth and lower hiring rates, might lead to lower mortgage rates. However, fluctuations in economic conditions and inflation expectations could introduce volatility. For updated mortgage rates and expert predictions, check Freddie Mac's Mortgage Rate Update and Mortgage News Daily.

Job Creations Revised Lower Again, Part-time Work Rises

The Bureau of Labor Statistics (BLS) reported a disappointing job creation figure for August, with only 142,000 jobs added compared to the anticipated 160,000. Revisions to previous months' data saw a reduction of 86,000 jobs, and the year-to-date adjustments have now cut 365,000 jobs from earlier estimates. A concerning trend is the rise in part-time work by 527,000, while full-time positions decreased by 438,000. This suggests that the unemployment rate's drop to 4.2% is partly due to an increase in part-time employment rather than an improvement in full-time job availability.

August Saw Smallest Private Sector Job Gains Since 2021

ADP’s report revealed that private sector job growth slowed to 99,000 in August, well below the forecasted 145,000. This slowdown marks the fifth consecutive month of declining job creation. Significant losses were reported in manufacturing, information, and professional services sectors, while small businesses faced challenges with a net loss of 9,000 jobs.

Low Hiring and Quit Rates Show Labor Sector Weakness

The Job Openings and Labor Turnover Survey (JOLTS) showed a decrease in job openings to 7.7 million in July, falling short of expectations. The hiring rate remains near its lowest level since 2013, and the quit rate is also low at 2.1%, indicating a reduction in employee mobility and confidence in the job market.

Holiday Impact on Unemployment Claims

Initial Jobless Claims saw a slight decrease, with 227,000 new claims filed, while Continuing Claims fell to 1.838 million. The drop in Initial Claims may be partially attributed to the Labor Day holiday, which often affects the filing process.

Home Price Gains Continue

According to ICE, national home values rose by 0.2% in July, continuing the trend of increasing home prices. The annual growth rate has slightly decreased to 3.6% from 4.1%, but home values remain higher year-over-year, signaling a robust housing market.

For more detailed information on these topics, please refer to the following sources:

As we move forward, it’s crucial to stay informed about these economic indicators as they will shape the financial landscape, including mortgage rates. Keep an eye on upcoming data releases and Fed announcements for further insights.