According to Realtor.com Research, the September jobs report came in significantly weaker than expected, with payroll growth landing well below what economists were anticipating. This softer employment picture is happening at the same time mortgage rates are climbing sharply, with the Freddie Mac 30-year fixed rate recently hitting its highest level since November. Those climbing rates mean homebuyers are facing noticeably higher monthly payments on new mortgages, which is putting pressure on affordability across the country.
The research team noted that while mortgage rates crossing the 7% threshold makes for eye-catching headlines, there's more nuance beneath that number worth understanding. They're tracking broader shifts in the housing market including how inventory levels are changing, what listing activity looks like, and how the balance between buyers and sellers is evolving as rates rise.
On the positive side, home price growth has actually continued to pick up momentum according to the S&P Case-Shiller Home Price Index when looking at national trends through the period they measured. This reflects the ongoing tension in the market where prices are still moving up even as borrowing costs are increasing and job growth is slowing down.
What I am seeing locally here in the Bay Area and East Bay is a market that's getting squeezed from both sides. Higher rates are cooling buyer demand right when employment is weakening, but homes still aren't sitting around waiting to be bought. For sellers, this is a moment to be realistic about pricing and condition. For buyers, it's becoming tougher to make deals work at the numbers, so getting your financial ducks in a row before you start looking is more important than ever.
