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Mortgage Rate Update 3/1/21

Hello, hello everybody. Sean Zalmanoff here with this week’s mortgage rate update.

Oh gosh, lots of news last week. As we talk about often, rates go up quicker than they go down and man, we had a little bit of a jump last week. There was some stability in the market and we gained about a quarter point back on Friday. That’s good news. Again, the market’s just a little spooked about stimulus and about the economy potentially recovering faster, which would be a good thing, than previously expected. It’d be a really great thing for our small businesses as many just got another round of the PPP money and that would, if the economy does recover quicker, that would allow that money to get them through what they need to. Some of that’s going to be at the expense of mortgage rates if that happens.

We’ll see what happens this week. We got a lot of economic news, but first, hey, did you know, the last five years home prices have increased on a national average of 39%. For many of us, that is the largest retirement asset that we have. That is something that is really good, man. You’re up 40% in the last year. Now, if you live in Idaho, you’ve increased 82 1/2%. If you live in North Dakota (music). Sorry, North Dakotans. Is it North Dakatans? I don’t know. If you live in North Dakota, you’re only up about 14%. I think there’s a lot of oil in North Dakota and the shale mining, which I may or may not be right on, has possibly not treated you well. Fortunately, except for those of you who live in North Dakota, there aren’t a lot of people that live in North Dakota.

But way to go Idaho. Oh, we have unemployment numbers this week. As always, the first week of the month, the first Friday of the month, when the first Friday is not the first day of the month, and since today is March 1st, the first Friday of the month is definitely not whatever I’m talking about here. Some the other big news this week… Before I get into that, the first week of March is always really a very special time because it is my birthday. I know, I don’t need much, but I will take gifts from you if you want to send them my way.

For the unemployment numbers. I’ve had a lot of questions because I do talk about it because it is such a big market indicator. How in the world is the government calculate this thing? So 60,000 households are surveyed per month to determine the unemployment number. Now the labor participation rate, there’s a lot of factors that go into this, if somebody is not actively looking for a job the unemployment number gets depressed. It gets better than it actually is because if you haven’t looked for the job in the last 30 days, you’re not involved in that. Roughly 297 million working people in the United States. And so 60,000 get surveyed, I think it’s like one of every 2,000 or something like that actually gets surveyed. That’s why you’re going to see some variations of the number, you’re going to see things changing. They try to get a good sample size and over time it’s worked, but because it is a survey and because it’s impossible to track everybody, fortunately, they can’t track everybody every month. And there’s some variance that goes into that as well too.

Hey, it’s still an amazing real estate market. If you haven’t taken advantage of these rates to refinance, got to tell you folks, you need to do it now. I’m not sure that they may ever be this low again. If the economy heats up, if we do get a little bit of inflation, and a little bit of inflation is not a bad thing. I know the media is telling you it is. It’s not a bad thing. That means things are starting to heat up. That means people are spending more money. It means dollars are turning over. It means our businesses are back at work. Those are great things, but that’ll happen at the expense of interest rates because as prices rise, as you know by now, one of my favorite things I’d tell you is inflation is the archenemy of bonds. If bond yields rise, interest rates rise. Take advantage of it now. If you’re thinking about buying that house, take advantage of it.

Now give us a ring we’d love to help you. I’m Sean Zalmanoff for the Sean Z team. You all have an awesome week. Peace.

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