Job openings rise 7.6%

The Labor Department has said the number of job openings in January rose 7.6%, to 2.7 million, compared to December; this is the highest total since February 2009. Analysts say as many as 300,000 jobs may be added in March, a four-year high, giving rise to a hope of sustained employment gains and economic recovery. Joseph LaVorgna, chief U.S. economist at Deutsche Bank Securities, says a 450,000 payroll gain in March “can’t be ruled out,” and job gains are “going to convince people of the sustainability and durability of the recovery.” Some economists have cautioned that the job gains may not happen at a rapid pace. “It’s getting better, though not as quickly as you’d like,” said Dan Greenhaus, chief economic strategist at Miller Tabak. Indeed.com, which tracks job openings in 12 industries, said last week that 10 of the 12 industries posted more job openings in February than they did a year ago. “We have seen a sharp turnaround in the job market in the last few months,” said Paul Forster, CEO of Indeed.com. Among the 12 industries, hospitality and retail industries – which are critical to economic recovery – saw the biggest gains in job openings last month. When the recession began 1.7 people were competing for each opening. There are now 5.5 unemployed people, on average, competing for each job opening, against just over 6 people per opening in December 2009.

NorthWest Real Estate

Yesterday, I attended the Windermere Kick-Off breakfast. The highlight for me was listening to real estate economist, Matthew Gardner. This proved to be very valuable since I do a lot of business in the Bonney Lake, Lake Tapps, Buckley, Puyallup, Sumner and surrounding areas and I want to stay current with the real estate market trend and home values.

Matthew provided a substantial amount of information about the economy and housing, and he was quite entertaining. He predicts rates will be 6% by year end. I have run some figures on payments, equity position and qualifying income based on his prediction.

Using a loan amount of $300,000, the principle & interest payment at 5% would be $1610.46 per month. At 6% the payment would be $1798.65, a difference of $188 per month. At the end of five years the loan balance with the 5% loan would be $275,486, and $279,163 with the 6% loan. If you take into account the monthly savings over five years plus the additional equity, your clients can save close to $15,000 by taking advantage of the low interest rates.

The other issue that comes into play with higher rates is qualifying. Using the 5% rate plus taxes, insurance and MI, the qualifying income would be approximately $7023 per month. At 6%, the qualifying income goes up to $7650 per month. Another way to look at it is someone making $7023 per month can qualify for $300,000 at 5%, but only $268,500 at 6%. What a difference only one percentage point makes!

So if there was ever a good reason to get off the fence and start your home buying process, this is one of them. Not only are the mortgage rates at an all time low, so are the house prices. Contact me at 253-209-9701 and I will help find and negotiate a great home for you. As a marketing specialist I can help you sell your home fast and at market value.

NorthWest Real Estate

As you know, The original $8000 tax credit was just good for first-time home buyers and was slated to end on Nov. 30. But Congress extended the credit to include contracts signed by April 30 and closed by June 30. It also made a refund of up to $6,500 available to existing homeowners looking to buy something new. Nov. 6 marked the date that the rules changed because an extended — and expanded — version of the home buyer tax credit went into effect. And that put filing for the credit on hold, and started a new IRS paperwork wrangle. Those homeowners who closed their sale before Nov. 6 used Form 5405 to claim the credit, but those closing after that date are in limbo because no form yet exists for them to file. The IRS had been expected to come out with a revised form by early January, but it has yet to release anything. Robert Dietz, an economist with the National Association of Home Builders who has been monitoring the situation, said the delay may be caused because numerous parties, including the Treasury Department, have to agree on how to process all the new documentation that the expanded tax credit requires. “They may just be making sure all their I’s are dotted and their T’s are crossed before they release it,” Dietz said.

NorthWest Real Estate