Bloomberg put part of the blame on the Nor’easter that tore up the East Coast last month, but last Friday’s Employment Situation Report from the Labor Department was the worst since last May. There were 98,000 jobs created during March, while analysts polled by Econoday were looking for 125,000 to 202,000. Further, the number of jobs created in February was revised down from 235,000 to 219,000.
The report’s bright spot was a sharp drop in the unemployment rate which fell by 0.2% to 4.5%, the lowest rate since the high point of the last expansion, April 2007.
Spring seems to be the season for surveys. Freddie Mac asked renters about their housing situation and found more than half saying renting is good for them, up 4 percentage points since the September survey. Millennials seem more content with their status than their older counterparts; 73% said they would rent when they next moved, up from 64%, and well above the 59% of all renters who expressed that choice.
Renters increasingly prefer single-family houses. The aggregate of those who want to move into an apartment complex, either small or large, fell by 7 percentage points while preference for a home or condo rose by 5 points.
Sales of both new and existing homes set records last year, but a survey by the National Association of Realtors (NAR) found vacation home sales had plummeted. Sales to owner-occupants rose from 3.74 million in 2015 to 4.21 million in 2016, accounting for 70% of the market, but vacation home purchases fell by 21.6%, from 920,000 to 721,000. Those second home purchases accounted for 12% of sales, down from 16% in 2015 and the lowest share in five years.
Individual investors (those who buy less than 10 properties in a year) picked up some of the slack. Their purchases increased by 4.25% to 1.14 million. Both investors and vacation homebuyers showed a greater inclination to rent out their homes short-term (less than 30 days) and both took out more mortgages than in the past. All-cash sales to investors and vacation homebuyers declined by 4 and 10 percentage points respectively.
NAR Chief Economist Lawrence Yun speculated that the decline in vacation home sales was only temporary, due in part to rising home prices, but also to the volatility in the financial markets in late 2015 and early 2016. “Some affluent households with money in stocks likely refrained from buying or delayed plans until after the election,” he said.
It is “Spring Market Time” and mortgage rates are cooperating. They have now declined for four straight weeks, putting the 30-year fixed-rate right back where it was during the week ending December 1st.