In this weekly market update, Jordan Keck reports a modest decline in mortgage rates to 6.75% and discusses how weaker-than-expected jobs data could prompt the Federal Reserve to consider rate cuts. He provides a practical mortgage tip on determining flood‑zone status using FEMA’s online map portal, explains the limited role of elevation certificates, and outlines how to request letters of map amendment or change. Keck then reviews a series of economic releases: the June JOLTS report shows a sharp drop in job openings and a hiring rate near historic lows; consumer confidence rises modestly, driven by future‑expectations optimism; home‑price indices (Case‑Shiller and FHFA) appear to decline seasonally but actually rose 0.4% in May on a raw basis, with year‑over‑year gains still positive. ADP’s July employment numbers beat expectations, while the BLS July jobs report reveals a stark contrast—only 73,000 jobs added versus 110,000 forecast, with over a million jobs lost in the raw figure and a rise in unemployment to 4.2%. The Q2 GDP initial estimate comes in at a 3% annualized rate, surpassing the 2.4% forecast, and PCE inflation for June is steady at 3% month‑over‑month, with core inflation holding at 2.8% year‑over‑year, suggesting limited room for immediate Fed easing. Keck concludes with cautious optimism that the weak jobs data may eventually lead the Fed to cut rates, while acknowledging the mixed signals across the data releases.
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Good morning and happy Friday. Jordan Keck here, your lender buddy, with your weekly market update. Kicking off, interest rates moved down slightly from 6.81% to 6.75%. Likely going to see a little bit of improvement to later today as well because of some of the jobs report data that came in weaker than expected, which can lead future expectations for the Fed to cut interest rates versus saying there's a strong enough job market to leave them where they are. And starting with our weekly mortgage tip, I wanted to talk about flood zones. This is something I get a lot of questions about. Had one earlier this week where someone was listing a property, looking at questions on, is this in a flood zone? Do we disclose that? How do we find out? Is it going to be required? And best place to start on this I'd recommend is the FEMA flood map site. Search portal where you can type in an address and see the overlays of where they show certain properties in flood zones. And that is msc.fema.gov/portal/search, and you'll be able to see exactly where the flood zones are at. You can also look at, um, one of the questions I get a lot is, does an elevation certificate show that a property is out of a flood zone? The short answer, there's no real yes or no because If the lender pulls up a flood determination and it shows it is in a Zone A or AE, those would require flood insurance. Elevation certificate wouldn't immediately remove it from that, but it is something you can send into FEMA, request a letter of map amendment or a letter of map change, and then have that removed. The difficult part is if there is already an existing letter of map amendment or letter of map change, there's not a super easy way to be able to find that. They do have them listed on their website, but they don't really have them by address. And so sometimes it's just a manual search to be able to figure those out. So if you have questions about a property, if you're not sure if it's in a flood zone or not, not sure if it's a letter of map amendment or want some help on what the process is to use an elevation certificate to get it removed, let me know. Happy to be able to walk through that with you. Next up, the June JOLTS Job Openings Report fell 275,000 to 7.437 million, which is 113 below estimates here. The hiring rate also fell from 3.4% to 3.3%, which is the second lowest number on record besides 2013 when you remove COVID, slowing— showing slowing in the hiring market. Consumer confidence, it did increase 2 points from 95.2 to 97.2. This is almost mostly due to the future expectations component rising to 74.4. About 19% of consumers felt that jobs were hard to get in July, which is up from 14.5% since the start of the year— or excuse me, up 14.5% since the start of the year. Next up, home appreciation. Case-Shiller and FHFA showed prices down 0.3% and 0.2% for the month of May respectively. But these are seasonally adjusted numbers. You look at just the raw data, they both showed home prices were up 0.4% for the month. So if you're looking at the headline data and seeing home prices have gone down, just know that that's only because of those seasonal adjustments. And actually they're up almost a half a percent in the month of May alone. Year over year, Case-Shiller is up 2.3% and FHFA is up 2.8%. I mean, home prices are still higher, just not as fast. Growth as we've seen in the past. Next, ADP's July jobs report reported 104,000 job gains versus the 75,000 expected, and the previous month was also revised higher by 10,000, adding strength to this report. Income for job stayers, those who stayed at the same job, rose 4.4% year over year, and job changers saw a 7% increase over the year. Quarter 2 GDP, we had the initial reading. This is going to be the first of 3 readings for quarter 2 reported at an annualized rate of 3%, which is stronger than the 2.4% expected. This is coming off the heels of a quarter 1 reading of a negative 0.5% being revised lower in both of the, uh, second and final readings there. This again is the initial reading quarter 1, so we'll see if quarter 2 gets revised lower as well, just like quarter 1 did. Next up, PCE inflation for the month of June rose 3%, as expected. Not a whole lot of changes on this one. Year-over-year rose to 2.6%, which is slightly above estimates since the prior month's report got revised higher by 0.1%. The core rate rose 0.3%. Year-over-year remained at 2.8% after being revised from the last report. And the last 3 months trend on inflation is trending higher, which isn't great here, and it doesn't really help facilitate reasons for the Fed to cut interest rates if inflation is going to continue moving higher. But what did help, and this is the information that came out today, was the July BLS jobs report showing only 73,000 job gains versus 110,000 expected. But it actually gets worse than that. This is a seasonally adjusted number, and the raw figure showed 1.07 million job losses in the month of July, plus the prior two months revised lower by a combined 258,000. ,000 in a very, very weak jobs report here. In addition to that, the household survey, which is a component where the employment rate comes from, showed 260,000 job losses with an unemployment rate rising from 4.1% to 4.2%. So hopefully because of this, this is enough for the Fed to be able to justify cutting interest rates in future meetings, but we will see what happens. As always, hopefully this is helpful. Have a great weekend. Happy August, and we'll see you next time.
