Friday Market Update for the Week of June 4th 2021

Happy Friday, Brian Manning here with the weekly update. Let’s get right to it. So, Monday this week everything is closed for Memorial Day.

Tuesday this week was a relatively quiet news day, Wednesday of this week and every single Wednesday we get information on mortgage applications from the Mortgage Bankers Association. And on a year over year basis purchase mortgage applications are up 2%. This is pretty remarkable to see because right now we have inventories down 21%, home appreciation is up 13%. So we’re still seeing a very strong housing market as far as purchase mortgage applications are concerned. Also, we got some info on cash buyers, you know, a year ago, cash buyers were making up 17% of all purchase transactions, and now they’re at 25%. So we’re seeing more and more cash comes into the game, certainly makes it difficult for first time homebuyers when they’re competing against so many cash buyers. Definitely one of the reasons why we’re seeing 13% appreciation right now, Thursday this week, we get the ADP report.

So the first week of every month we get the employment data. Usually we get ADP in a Wednesday, but since Monday was a holiday, it gets pushed out one day. So Thursday of this week we got employment data from ADP, they’re the largest provider of payroll United States for private companies. And ADP had employment gains of 978,000 new jobs for the month of May, which is a really strong report and exceeded analysts expectations by about 300,000 jobs. We also have initial jobless claims as we get every week. So this is new people filing for unemployment for the first time. And this is that 385,000 people. So the lowest numbers since the pandemic started. So really good to see those numbers changing as well. Today we get the BLS.

So the first Friday of every month we had the Bureau of Labor Statistics, it’s their feedback on jobs created for the month of May. And BLS had 559,000 new jobs created, there was a slight miss, but pretty close to being in line with expectations. I think analysts expectations were right around 600,000 jobs for the month of May. So we were pretty close there. We also had prior months revised in a positive fashion as well. So normally you see this news, and you probably think you’d probably see more of a negative impact on the bond market, which would have an impact on interest rates, but we have John Williams, who’s the federal president… Federal Reserve president in New York, so he’s second in line in the Federal Reserve. And John Williams is really saying that, you know, we’re pretty far away from doing anything meaning tapering. So right now the Federal Reserve is still very actively involved in buying US treasuries and mortgage backed securities and in this bond buying program, they’re really forcing keeping rates down and when they have no talk of tapering anytime soon, because they’re still waiting to see what’s going to happen with inflation. There’s no way to see what’s going to happen with US economy, bond markets like this and this really worked in our favor today for interest rates because bond traders and what’s going to really translate to us in mortgage interest rate markets, saying that the Federal Reserve is going to keep our rates low for quite a long time. So that’s pretty good to see.

I’m around all weekend. If you have any questions let me know. I’d love to help you in any way I can. If you need a pre approval, you want to go through a strategic buying consultation, call me on my cell phone, text me. Happy Friday. Hope you have a great day!