Hope you’ve enjoyed your holiday season and now we’ve turned the page to a new year. Unbelievable, right!? Mortgage rates moved sideways for much of the end of 2021 but since the beginning of this year on Monday, they’ve moved higher due in large part to economic data showing an economy becoming stronger and consumer spending strengthening.
According to data that came out last week, the housing market remains strong with homes selling in an average of 18 days! Plus, the year-over-year appreciation rate stands at 19 percent for 2021, creating lots of wealth for the nation’s homeowners!
So, what can we expect for the housing market and rates in 2022? Well, we don’t know exactly but predictions are that despite an expected slow increase in rates, the purchase market will remain strong thanks in large part to the demand by first-time home buyers.
What does this mean for you? Home values continue to increase and are expected to continue at a 10 percent year over year rate, which makes it ideal to buy if you don’t yet own a home and an ideal time to access the equity in your home as a refinance for home improvements or to eliminate mortgage insurance. Reach out to me if you’d like to discuss your options.
What I’m watching this week…
For this first full week of the new year, we’ve got some high-impact economic reports coming, including Friday’s Jobs Report. But before that, we started the week looking at the construction sector. Material and labor shortages are being felt in the construction sector, evident in spending data which have missed expectations in the last three reports. November’s number missed as well coming in at a .04 monthly gain when 0.6 percent was expected.
As for the manufacturing sector, amid strong optimism, a key index that tracks sentiment has held steadily near the 60 line month after month, indicating expansion. After November’s 61.1, forecasters predicted 60.5 for December; however sentiment proved less positive at 58.7.
On Wednesday, the slew of employment reports begins with the ADP report on private-sector job creation. The forecast for December’s estimate is 414,000.
On Friday the government’s report on the nation’s employment picture comes out. We are expecting to see a 400,000 rise in job growth in December which in November, at 210,000, missed low-end expectations. Wage inflation is expected to slow 7 tenths to an annual 4.1 percent.
We’re also anticipating a drop in the unemployment rate to 4.1 percent and an increase in the workforce participation rate to 61.9 percent.
