Rates managed to improve a little today after going higher yesterday due to an ADP payroll report that exceeded all expectations. Though the ADP report has been all over the place and hasn't consistently been a good indication of the actual payroll figures that are released the first Friday of the month. The Non-Farm Payroll report due out tomorrow can be a big market mover.
Technically (technical indicators on the FNMA bond) the bond is set for a bump higher which would mean rates may improve going forward, but technicals take a back seat to this report as a good job number will be bad for mortgage rates and will certainly trump technicals.
So what will happen tomorrow? The number everyone is expecting is 150k new jobs or more. If the number of new jobs created is much larger than this rates will certainly go higher...and quickly. If the number is much below 150k I would expect rates to either improve or hold where they are now. I don't expect rates to improve dramatically even with a miss to the downside...unless its a huge miss.
So what to do? If you are looking to refinance you should have been locking in your rate by now, but if you are trying to figure out if you are going to be able to benefit from a refinance in the next few months I guess you hope for a low employment figure and then lock in the rate pretty quick because rates are on the rise and I don't think that general trend will reverse over the coming months.
Me...I want low rates, but I also want to see the economy improve and jobs added so there are more people out there who can afford to purchase a new home or feel more secure in their current job and make a move to a more expensive home...this is what is needed to really get the housing sector back on solid ground.
Either way I will be here to help with any questions or a new loan if that is in your goals for 2011.
Watch the the number tomorrow morning and you can also follow me on Twitter..where I am a little more timely with info. http://twitter.com/westseattlemtg
Happy new year...it will be a fun one!
