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08.26.24

Written by Chase Majerus

Job Growth Miscalculation

Welcome to This Week Today, your go-to newsletter for mortgage, real estate, and financial news, delivered with a dash of humor and a side of savvy insights. This week, we’re diving into the biggest job growth miscalculation since 2009, exploring what it means for interest rates, and taking a closer look at the wildfire risks facing homeowners in the West. Buckle up—it’s news that makes you feel smarter, all while keeping you entertained!

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Wanted: Accurate Job Reporter

Hey remember that job growth that the US economy bragged about?

Well it turns out the U.S. economy created 818,000 fewer jobs than we first thought between April 2023 and March 2024, thanks to a big oopsie from the Labor Department. They initially reported 2.9 million new jobs, but it turns out they were off by nearly 30%.

It’s the biggest blunder since 2009, and now the actual job growth looks more like 2 million, which is still a lot but not quite as impressive.

Some industries like business services, leisure, and retail took the biggest hit in these revised numbers. But hey, education, health, and transportation managed to sneak in some extra jobs!

Even with this miscalculation, the job market’s not in a total free fall, but it might just give the Federal Reserve a reason to finally cut interest rates. Wall Street’s been anxiously waiting for this so maybe September will bring some rate-cutting celebrations!

Read more here

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An interesting thread on real estate investing – Read here!

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Financial Fitness

Wildfires Are Spreading Like…

There’s no getting around this, climate change is intensifying wildfires. And this puts around 2.6 million homes in 14 western U.S. states at risk.

If you live in California, you probably aren’t surprised that your state leads the pack with over 1.2 million homes in danger. And this wildfire threat worsens the already severe housing shortage, further straining efforts to close the gap. Rising insurance costs in high-risk areas are making it harder for homeowners, though regulatory changes in California aim to improve coverage.

CoreLogic, who initially reported on this subject on August 21st, highlighted that mitigation efforts, such as creating defensible spaces and using fire-resistant materials, can significantly reduce potential wildfire losses.

If these measures had been in place, the devastating 2018 Paradise, California fire’s impact could have been cut by up to 75%.

If you’re a homeowner in 1 of the 14 named western states, we recommend reaching out to a Synergy One Lending representative to discuss what options you have when protecting your home.

Get in touch with a local loan officer here!

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S1 FinFit is a FREE app that provides a roadmap to help you reach your financial and lifestyle goals, no matter how big or small! Free credit monitoring with alerts, set financial goals, create budgets, and keep track of your spending to see where your money is going.

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Bullish on rate cuts; Bearish on home sales

Ok so the U.S. economy’s job growth was pretty significantly overestimated. That’s a bummer but that’s just going to bring rates down and boost home sales like everyone predicts… right?

Recent forecasts from Fannie Mae, Freddie Mac, and the Mortgage Bankers Association say the impact on home sales from lowered rates will likely be minimal which completely subverts conventional thinking. What’s going on?

The numbers don’t lie, the home prices vs. incomes battle is keeping affordability low. Too low for the potential of an uptick in home sales.

So, it’s official, Fannie Mae and the MBA both downgraded their home sales forecasts for 2024 and 2025, citing listless demand and a persistent “lock-in effect” where current homeowners are hesitant to move.

On the flipside, refinances might see some growth due to marginally better rates!

But this Fannie Mae forecast suggests that while new-home sales might fare better due to builder concessions, overall, the housing market will continue to face challenges as affordability issues persist.

Read more about the new outlook here or here!

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This is the ultimate beginners guide to buying your first home

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This is the ultimate beginners guide to buying your first home:

  • Your credit score is like the base of a successful home purchase. Aiming for a credit score of 700 or higher will often get you access to get better rates!
  • The down payment. Common knowledge says you need to put 20% down but THAT’S NOT EXACTLY TRUE. Synergy One Lending offers tons of loan options that require a lot less cash for a down payment so long as you qualify.
  • Understand the term interest rates. It is a huge part of your monthly payment. And, in short, lower interest rates save you money. And you earn those lower interest rates by having a great credit history.
  • Figure out the right loan product for your financial situation. FHA, ARM, VA, Conventional, Buydown… there’s a lot more and it’s definitely confusing.

Luckily, you won’t have to do this by yourself if you’re working with Synergy One Lending!

Check out our video here

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