Mortgage rates could move higher beginning tomorrow morning. The Bureau of Labor Statistics releases its February jobs report at 8:30 AM ET.

Home buyers and rate shoppers in Danville would be wise to take note. The jobs report is almost always a market-mover.

Consider last month.

Although net job creation fell well-short of expectations in January — just 36,000 jobs were added — the national Unemployment Rate dropped to 9.0%, its lowest level in 2 years. The marked improvement surprised economists and sparked inflationary concerns within the investor community.

This, in turn, caused mortgage rates to rise.

In the days immediately following the jobs report’s release, conforming rates across California jumped 0.375 percent. That’s equivalent to a mortgage payment increase of $22 per month per $100,000 borrowed.

A similar spike could occur tomorrow.

Wall Street scrutinizes job growth because with more working Americans, there’s more consumer spending, and consumer spending accounts for 70% of the U.S. economy. A blow-out number tomorrow would change expectations for the future, and lead rates higher again.

The economy shed 7 million jobs between 2008 and 2009 and has barely made 1 million of them back. Tomorrow, analysts expect to see 183,000 jobs created. If the actual reading is lower-than-expected, mortgage rates should fall and home affordability will improve.

Anything else and mortgage rates should rise. Likely by a lot.

Therefore, if you’re shopping for a mortgage right now, consider your risk tolerance. Once markets open tomorrow, you can’t get today’s rates.

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Americans are getting back to work. Sort of.

This morning, at 8:30 AM ET, the Bureau of Labor Statistics released its Non-Farm Payrolls report for January 2011. More commonly called “the jobs report”, the government’s data showed a large decrease in the number of working Americans as compared to December, but a sizable drop in the Unemployment Rate.

The job growth figures were much lower than consensus estimates:

• Expected job growth in January : +148,000 jobs
• Actual job growth in January : +36,000 jobs

January’s Unemployment Rate surprised analysts, too, but not in a bad way, falling from 9.4 percent in December to 9.0 percent last month. This is the nation’s lowest Unemployment Rate in nearly 2 years.

Today’s jobs report is rough news for home buyers and rate shoppers in Danville. Shortly after the report’s release, Wall Street is attributing the low jobs number to “bad weather” and is choosing to focus on the strong Unemployment Rate instead.

U.S. stock futures are now rising ahead of open, an increase that will come at the expense of the bond markets. Indeed, mortgage-backed bonds are losing this morning already.

Conforming mortgage rates are expected to start the day at least +0.125% from Thursday’s close and, if momentum continues, could tack on an additional +0.125% before today’s closing bell.

The government’s report is an excellent example of how important jobs data can be to home affordability — especially in a recovering economy.

The economy shed 7 million jobs between 2008 and 2009 and fewer than 1 million of those were recovered in 2010. It’s a data point Wall Street watches closely because more working Americans means more consumer spending, and more consumer spending means more economic growth. Consumers account for 70% of the U.S. economy, after all.

More workers also means more taxes paid to federal, state and local government, and, in theory, fewer loan charge-offs from banks. These, too, keep the economic engine moving forward, spurring more spending and job growth. 

If you have not yet locked a mortgage rate, consider locking one today. On the heels of today’s jobs data, 30-year fixed rates will scratch at their highest levels of the year.

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On the first Friday of each month, the Bureau of Labor Statistics releases its Non-Farm Payrolls report.

More commonly called “the jobs report”, the government’s data include raw employment figures and the Unemployment Rate.

The jobs report hit the wires at 8:30 AM ET today. It’s making big waves in the mortgage market and may help home affordability for buyers in Danville this weekend, and would-be refinancers across California.

For this month, and for the rest of 2011, employment data will figure big in mortgage markets.

7 million jobs were lost in 2008 and 2009. Fewer than one million jobs were recovered in 2010. For the economy to fully recover, analysts believe that jobs growth is paramount.

Consider how job creation influences the economy:

1. More jobs means more income and more spending
2. More spending means more business growth
3. More business growth means more job creation

It’s a self-reinforcing cycle and, as business grows, the economy expands, pushing stock markets higher. This tends to lead mortgage rates higher, too, because bonds can lose their appeal when stock markets gain.

According to the government, 103,000 jobs were created in December, and October’s and November’s figures were revised higher by a net 50,000 jobs for a total of 153,000 new jobs created. Economists expected a net gain of 135,000.

The Unemployment rate fell to 9.4, its lowest level since mid-2009.

Wall Street is voting with its dollars right now. Mortgage bonds are improving, pointing to slightly lower mortgage rates today.

The December jobs report was “average”, and home affordability is improving.

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Mortgage rates are rising, up nearly 1 percent since mid-October. Tomorrow, rates could rise again.

The Bureau of Labor Statistics releases the November jobs report at 8:30 A.M. ET Friday. With a stronger-than-expected reading, mortgage rates should continue their climb, harming home affordability across California and nationwide.

And already, Wall Street is bracing for big results.  Here’s why.

Wednesday, payroll processor ADP said that 98,000 private-sector jobs were created in November. The figure was a complete blowout reading as compared to analyst estimates, which had the results in the 50,000 range. But that wasn’t all. ADP re-measured and re-reported October’s gains, too. It found that 84,000 jobs were created — not the 43,000 on its original report from 30 days ago.

If jobs growth is the keystone to economic recovery, the ADP report suggests that recovery is already underway.

It’s bad news for rate shoppers. A faltering economy helped keep mortgage rates low. A recovering one should make rates rise. And, that’s exactly what happened Wednesday.

In response to the ADP report, conforming mortgage rates posted their third-worst day of the year. Rates climbed as much as 0.375 percent throughout the day as lenders scrambled to keep up with a deteriorating market.

At some banks, rates changed 4 times between the market’s open and close.

Tomorrow, analysts expect the government to report 146,000 jobs created in November. Mortgage markets and home affordability have a lot riding on the actual results. A lower-than-expected reading should lead mortgage rates lower. Anything else and mortgage rates should rise. Likely by a lot.

Therefore, if you’re shopping for a mortgage right now, or floating a loan that’s in-process, think about your personal risk tolerance and whether you want to gamble against rates moving higher. Once Friday morning’s report is released, it may be too late to lock something lower.

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Mortgage rates have been falling since April, shedding more than 1 percentage point since the Refi Boom began. Today, that momentum could lose some steam.

The Bureau of Labor Statistics releases the October jobs report at 8:30 A.M. ET. With a stronger-than-expected reading, mortgage rates should rise, harming home affordability in California and nationwide.

As cited by the Fed earlier this week, jobs are a key part of economic growth and growth affects mortgage rates.

Looking back at jobs, starting in January 2010, after close to 24 consecutive months of job loss, the economy added jobs for the first time since 2007. It started a small jobs winning streak. By May — boosted by the temporary census workers — monthly job growth reached as far north as 431,000 jobs.

That figure then slipped negative in June and has yet to turn-around.

This month, economists expect 61,000 jobs lost and 9.6% Unemployment Rate.

Jobs matter to the U.S. economy. Among other reasons, employed Americans spend more on everyday goods and services, and are less likely to stop payments on a mortgage. These effects spur the economy, stem foreclosures, and promote higher home values.

The reverse is also true. Fewer workers means fewer disposable dollars and, in theory, a slowing economy. Weak jobs data should spur a stock market sell-off which should, in turn, help lead to mortgage rates lower.

Strong jobs data, on the other hand, should cause mortgage rates to rise.

The stronger October’s employment figures, the higher mortgage rates should go.

Mortgage rates have been jumpy this week because of the Federal Reserve and its new support for bond markets. Today’s employment report should add to the volatility.

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On the first Friday of each month, the Bureau of Labor Statistics releases its Non-Farm Payrolls report from the month prior.  This month, though, because the first Friday of the month was also the first day of the month, the report was delayed one week.

The report hit the wires at 8:30 AM ET this morning.

More commonly called “the jobs report”, the government’s non-farm payrolls data influences stock and bond markets, and, in the process, swings a big stick with home affordability figures in Danville and nationwide.

Especially in today’s economic climate.

Although the recession has been deemed over, Wall Street remains unconvinced. Data fails to show the economy moving strongly in one direction or the other and, absent job creation, economists believe growth to be illusionary.

Consider:

1. With job creation comes more income, and more spending.
2. With more spending comes growth in business
3. With growth in business comes more job creation

And the cycle continues.

The prevailing thought is that, without jobs, consumer spending can’t sustain and consumer spending accounts for two-thirds of the economy. No job growth, no economy recovery.

But there’s another angle to the jobs report, too; one that connects to the housing market. As the jobs market recovers, today’s renters are more likely to become tomorrow’s homeowners, and today’s homeowners are more likely to “move-up” to bigger homes. This means more competition for homes at all price points and, therefore, higher home values.

And that brings us to today’s jobs data.

According to the government, 95,000 jobs were lost in September. Economists expected a net loss of 5,000.  However, if public sector jobs are excluded from the final figures, jobs grew by 64,000.  This is a positive for the private-sector, but still trailed expectations.

Wall Street is voting with its dollars right now and mortgage bonds are gaining, improving mortgage pricing.

So, although the September 2010 jobs report doesn’t reflect well on the economy overall, home affordability in California and around the country should improve as a result. 

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On the first Friday of each month, the Bureau of Labor Statistics releases Non-Farm Payrolls data for the month prior. 

The data is more commonly called “the jobs report” and it’s a major factor in setting mortgage rates for residents of California and homeowners everywhere. Especially today, considering the economy.

This is because, although it’s believed that the recession of 2009 is over, there’s emerging talk of new recession starting.

Support for the argument is mixed:

1. Job growth has been slow, but planned layoffs touch a 10-year low
2. Consumer confidence is down, but beating expectations
3. Consumer spending is weak, but not declining

In other words, the economy could go in either direction in the latter half of 2010 and the jobs market may be the key. More working Americans means more paychecks earned, more taxes paid, and more money spent; plus, the confidence to purchase a “big ticket” items such as a home.

Jobs growth can provide tremendous support for housing, too.

Today, though, jobs growth was “fair”. According to the government, 54,000 jobs were lost in August, but that reflects the departure of 114,000 Census workers.  The private sector (i.e. non-government jobs), by contrast, added 67,000. 

In addition, net new jobs was revised higher for June and July by a total of 123,000.  That’s a good-sized number, too.

Right now, Wall Street is reacting with enthusiasm, bidding up stocks at the expense of bonds — including mortgage-backed bonds.  This is causing mortgage rates to rise.  Rates should be higher by about 1/8 percent this morning.

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Mortgage rates have been falling since April but that momentum could reverse tomorrow.

The Bureau of Labor Statistics releases the July jobs report at 8:30 A.M. ET Friday. With a stronger-than-expected reading, mortgage rates should rise, harming home affordability in California. Jobs are a keystone in economic growth and growth is tied to rates.

Earlier this year, job growth went positive and reached as far north as 431,000 jobs created in May. That figure slipped negative last month, however, as the temporary, decennial census workers left the workforce.

Jobs matter to the U.S. economy. Among other concerns, unemployed Americans spend less on everyday goods and services, and are more likely to stop payments on a mortgage. These effects retard the economy, spur foreclosures, and harm home values.

The reverse is also true. More workers means more disposable dollars and, in theory, a stronger economy.

Analysts expect that a net 65,000 jobs were lost in July. Wall Street — and Main Street — have a big interest in those results.

Poor jobs data would likely result in a stock market sell-off which would, in turn, boost the value of government-backed mortgage bonds. This is because bonds tend to perform well when the economy is sagging and higher bond prices mean lower mortgage rates.

Strong jobs data, however, would likely push stock markets up and bond markets down. This would cause mortgage rates to rise. The stronger the employment figures, the higher mortgage rates should go.

So, if you’re happy with where mortgage rates are today and you’re concerned about what the jobs report may do to them tomorrow, consider talking to your loan officer about locking your rate as soon as possible.

Once the jobs report is released, it may be too late.

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In June, for the first time since December 2009, the U.S. workforce shrank.

According to the Bureau of Labor Statistics, the economy shed 125,000 jobs last month even as the Unemployment Rate dropped to 9.5 percent. The drop in the Unemployment Rate is being attributed to fewer Americans looking for work.

At first glance, the jobs report looks weak but a deeper look shows something different.

Excluding the 225,000 government Census workers that recently left the workforce, the total number of employed persons actually grew by 83,000 in June. That’s 50,000 more working Americans as compared to May.

And, since the start of the year, the U.S. workforce has grown by 857,000.

Jobs growth is closely tied to economic growth because more working Americans means more disposable income which, in turn, stokes consumer spending. Job growth is better than job loss.

Consumer spending makes up the majority of the U.S. economy so as consumer spending grows, investor mentality tends to shifts toward “return on principal” (i.e. stock markets) from “safety of principal” (i.e. bond markets).

A move like this is often bad for home affordability because falling demand for bonds is tied to higher mortgage rates. In addition, with the growing number of Americans earning a paycheck, demand for homes is likely to increase, thereby helping to push home prices higher.

Overall, therefore, the jobs report should be bad for rate shoppers and home buyers in in Danville. Except, the markets aren’t reacting that way. For now, mortgage rates are slightly improved since the jobs report’s release.

Perhaps Wall Street is watching the wrong figures, but don’t let that be your loss. If you’re shopping for a mortgage, a home, or both, now may be your best time to make a move; while rates are still low; with home prices down; before traders change their tune.

Because when markets change, it’ll likely happen fast.

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On the first Friday of each month, the Bureau of Labor Statistics releases its Non-Farm Payrolls data from the month prior. 

The release is more commonly called “the jobs report” — a major factor in mortgage rates and monthly payments.

Especially now.

With the recession officially over and growth returning to the U.S. economy, the recovery’s next frontier is jobs. As job growth increases, home affordability should take a hit.  Here’s why:

1. As the number of working Americans increases, so should total consumer spending
2. As consumer spending increases, so should a return to risk-taking on Wall Street
3. As risk-taking returns to Wall Street, bond markets should start to lose

Mortgage rates, therefore, should rise.

Furthermore, as the jobs market stabilizes and recovers, renters should be more apt to buy their first home, and homeowners should be apt to up-size.  More home buyers in Danville means more competition for homes and higher home prices typically follow.

Job growth can be trickle-up for housing.

Today, however, the jobs data was not so strong. According to the government, 431,000 jobs were created in May, but of those new jobs, 95.4% represented temporary staffing for the 2010 Census.  The number of private-sector jobs created fell well short of expectations and Wall Street is voting with its dollars right now.  Mortgage bonds are gaining so, therefore, rates are falling.

The May 2010 jobs report may not reflect well on the economy, but home affordability in California and around the country is improving because of it.

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