Each week, we provide a 30,000-foot view of mortgage rate movement and the key economic forces shaping the housing and lending markets. Here’s what you need to know based on the most recent data.
Mortgage Rate Snapshot
- 30-year fixed rate: Down 0.125% week-over-week since Monday, February 2
- Rates moved modestly lower as markets continue to respond to signs of economic cooling, particularly in the labor market.
Market Summary
The U.S. labor market is steadily losing momentum, marked by weak hiring, rising layoffs, and softer demand for workers. At the same time, the housing market remains relatively resilient, supported by continued buyer demand and expectations for lower mortgage rates ahead.
What Happened Last Week
Labor Market Softness Continues
- The January Jobs Report was delayed due to the government shutdown and is now scheduled for release on February 11.
- Private payroll growth disappointed, with only 22,000 jobs added, well below expectations of 48,000.
- Job cuts were concentrated among large employers, while small business hiring remained flat.
- Hiring in 2025 has slowed sharply, with just 398,000 jobs added year-to-date, and downward revisions remain a possibility.
Additional Data Reinforces the Trend
- Initial unemployment claims have risen.
- Job openings continue to decline.
- Job cut announcements are increasing.
- Fewer companies report plans to hire in the months ahead.
Wage Growth Divergence
- Workers who changed jobs saw stronger wage gains (6.4% year-over-year).
- Wage growth for workers staying in place slowed to 4.5% year-over-year.
Housing Market Update
Despite labor market headwinds, housing continues to show relative strength:
- Home prices dipped slightly on a month-over-month basis but remain higher year-over-year.
- The home price outlook has improved, with forecasts calling for approximately 4.5% appreciation over the next 12 months.
- Expected lower mortgage rates and pent-up buyer demand are helping support prices.
- Real estate continues to offer long-term wealth potential, with steady appreciation contributing to equity growth over time.
Looking Ahead
This week’s focus shifts back to critical economic data, including:
- January Jobs Report
- CPI (Consumer Inflation)
- Retail sales
- Existing home sales
- Weekly jobless claims
Together, these reports will provide important insight into labor market conditions, inflation trends, and overall economic momentum—key drivers for interest rates moving forward.
As always, we’ll be monitoring the data closely and are here to help you navigate the market when you need us.
— Drew & Team
