Mortgage rates should remain low until fall 2021

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  • Unemployment affects mortgage rates; as the number of jobs increases, so too do mortgage rates.
  • The May vacancy report shows that 559,000 new jobs were added last month, much better than the 278,000 jobs in April.
  • But US labor shortages are likely not to improve until the fall, so it could be several months before rates hike.
  • See A Selection Of The Best Mortgage Lenders Insider »

Mortgage rates typically rise when the US economy is booming and fall when it is in trouble. Unemployment is one of the most significant economic factors affecting mortgage rates. As the number of jobs increases, rates tend to follow suit.

The US Department of Labor released its May employment report on Friday, and this report shows that job growth on the right track

You probably won’t see a sharp rise in mortgage rates anytime soon, but information in the job report indicates that they could rise in the next few months.

The labor market must improve for mortgage rates to rise

The good news is that 559,000 non-farm jobs were created in the US in May. This is a sharp improvement from 278,000 new jobs in April, much lower than economists had expected. (Although the number of jobs in May is 559,000 less than the projected number of new jobs, what was 674,000.)

The bad news is that there is an acute labor shortage in the United States. The US Chamber of Commerce said there are an average of 1.4 people for every open position in the country. Nebraska, South Dakota and Vermont have more open vacancies than the available applicants.

This labor shortage must improve dramatically for employment to improve steadily and mortgage rates to rise.

The federal reserve However, Governor Lael Brainard expects the labor market to improve this fall. Many unemployment benefits expire at the latest in September. Fewer people will have to worry about childcare when students return to school, and more people need to get vaccinated.

If jobs grow at the same rate as in the US in May and the labor market begins to improve, mortgage rates could start to rise this fall. You will probably have time this summer to find a home and lock in a low mortgage rate.

Current mortgage rates

Mortgage rates haven’t changed dramatically since last week or since last month. The rates may vary slightly from day to day, but you will most likely see the rates. stay at a relatively low level for another couple of months.

Current refinancing rates

Refinancing rates are generally higher than buying rates, but current refinancing rates are still at an all-time low.

Mortgage and refinancing rates by state

Check out the latest rates in your state using the links below.

Alabama
Alaska
Arizona
Arkansas
California
Colorado
Connecticut
Delaware
Florida
Georgia
Hawaii
Idaho
Illinois
Indiana
Iowa
Kansas
Kentucky
Louisiana
Maine
Maryland
Massachusetts
Michigan
Minnesota
Mississippi
Missouri
Montana
Nebraska
Nevada
New Hampshire
New Jersey
New Mexico
New York
North Carolina
North Dakota
Ohio
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina
South Dakota
Tennessee
Utah
Vermont
Virginia
Washington
Washington
West Virginia
Wisconsin
Wyoming

about the author

Laura Grace Tarpley is editor of Personal Finance Insider covering mortgages, refinancing and lending. She is also a Certified Educator in Personal Finance (CEPF). During her five years in personal finance, she has written extensively about ways to handle loans.

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