October 12, 2023 | Driving It Home with ABoR's Housing Economist

Last week beckoned a slew of jobs data, from job openings on Tuesday to the job report on Friday. After falling for three consecutive months, job openings rose in August to 9.6 million, measuring well above consensus expectations of 8.8 million. Meanwhile, employers added 336,000 jobs in September, nearly double consensus expectations. September’s figure also represents a sharp uptick from August’s upwardly revised 227,000 gain and the strongest gain since January. The unemployment rate was unchanged at 3.8%. Wage increases were somewhat softer than expected, with average hourly earnings rising 4.2% YoY and 0.2% MoM, compared to consensus expectations of 4.3% YoY and 0.3% MoM. Stronger than expected job numbers induced upward pressure on the 10-year Treasury yield, which reached a 16-year high last week, nearly topping 4.9%. Meanwhile, 30-year fixed-rate mortgages averaged 7.49%, the highest rate since 2000. According to the widely tracked CME FedWatch Tool, 88% of traders priced in no change in rates in the November meeting, while 74% of traders priced in no change in rates in the December meeting. Central bank policymakers have indicated in recent speeches that higher long-term interest rates may preclude the need for further rate hikes. However, the ongoing geopolitical tensions in the Middle East brought the 10-year Treasury yield down on Tuesday as demand for safe-haven assets increased. The September numbers for the PPI and CPI, which will be released this week, will play a pivotal role in shaping Fed policymaker’s decision on rates. In last week’s podcast, we discussed the uptick in activity that tends to occur at the end of the month, and to tread cautiously in interpreting week-over-week changes. Well, in this podcast, we’re comparing a more “normal” week (i.e., last week) to a week in which we generally see more activity (i.e., the last week of the month). Week-over-week activity is down this week, with both closed sales and leases down 32%. Active listings for both residential sales and leases were relatively flat. Pending sales were flat, but pending leases were down nearly 18%. Stay tuned for the impending release of the September monthly stats. Links mentioned in this episode: Buy vs. Rent Index https://www.abor.com/buyrentindex Give us Your Feedback Email [email protected] Download the Audio Transcript + Episode Summary: https://www.abor.com/content/uploads/... Buy vs. Rent Index: https://www.abor.com/buyrentindex Dr. Losey's Office Hours: Monday October 16, 2023 | 2-4 p.m. | ABoR Headquarters Connect with us on socials: https://www.abor.com/socials Connect with Dr. Clare Losey on LinkedIn:   / clare-losey