San Diego Mortgage Rates continued their assent higher last week, but did end the week on a positive note after a weaker than expected jobs report. The weaker than expected jobs numbers on Friday allowed the bond market to recover all of the losses from the previous day, but it still ended the week lower than it began. The bond market is still stuck in a downward trend, meaning San Diego interest rates could continue to rise over time.
Now remains a great time to consider a home purchase or refinance as San Diego home loan rates remain attractive compared to historical levels. Rates are still lower than they were this time 2 years ago. If you are interested in getting a mortgage rate quote, please click HERE or feel free to give me a call at 619-312-0612.
The Jobs Report for August didn’t give a lot of hope for workers looking for employment as the Labor Force Participation Rate fell to its lowest level in 35 years. The Labor Force Participation Rate measures the number of people who are either employed or are actively looking for work.
The number of jobs created was also lower than expected, with 169,000 jobs created in August versus the 177,000 expected. Making this report even worse, job creations for June and July were revised lower, removing 74,000 jobs from the previous reports.
The unemployment rate dropped to 7.3 percent; the lowest level since December 2008. Although, this number was probably lowered due to people leaving the labor force rather than job growth. It’s also important to note that outplacement firm Challenger, Gray & Christmas said that planned layoffs jumped by nearly 40 percent from July to August. This is the highest level in six months.
The housing news continued to be positive with research firm CoreLogic reporting that home prices rose 12.4 percent on a year-over-year basis in the month ending in July. This marks the seventeenth consecutive month of year-over-year price gains. However, home prices remain 17.6 percent below their peak levels from April 2006.
How did this affect San Diego Mortgage Rates?
Weaker economic reports can often cause investors to move money out of Stocks and into safer investments like Bonds, including Mortgage Bonds to which home loan rates are tied. We saw some of this occur late last week, as Bonds improved after the weak Jobs Report.
The Federal Reserve has stated that economic data will be a key factor in determining when to taper the $85 billion in Bond purchases it has been making each month to stimulate the economy and housing market. With economic conditions still wobbly and the housing recovery fragile, the Fed will be watching upcoming economic reports closely.
San Diego Jumbo Loans are very competitively priced right now; in fact in some cases the rates on jumbo loans are better than conventional loans. I just quoted a rate on a 30 year fixed for a purchase of a $1.4 million dollar home with a $900,000 loan amount. The rate was 4.625% at 0 points with an APR of 4.667%. The mortgage payment was $4,627.26. The client’s credit score was above 745.
What Could Affect Mortgage Rates This Week?
The economic data doesn’t begin until late in the week, with several key reports due out on Friday.
- Weekly Initial Jobless Claims will be released on Thursday. Despite the poor Jobs Report for August, claims have been hovering near 6-year lows.
- Friday brings the Producer Price Index (which measures inflation at the wholesale level), Retail Sales and Consumer Sentiment.
Remember, that weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and San Diego home loan rates to improve, while strong economic news normally has the opposite result.
If you are interested in getting a San Diego mortgage rate quote, please click HERE or feel free to give me a call at 619-312-0612. I am a Broker who specializes in closing loans on time with great customer service and I look forward to helping you secure the best San Diego Mortgage possible.