Monthly Archives: March 2014
Dr. Kenneth Rosen, Chairman, Fisher Center for Real Estate and Urban Economics and Professor Emeritus, University of California, Berkley emerges as a bit of a contrarian in an article in RealtyTrac’s March Housing News Report. Rosen says he is concerned that the new housing finance system that is being built will only serve to sustain today’s tight credit conditions, in itself a situation he calls unsustainable.
He describes the housing market as functioning as a “virtuous cycle;” the first time homebuyer progresses to the trade-up buyer and on to the downsizing buyer. However there is a lot of stickiness in this system and systemic problems that perpetuate sluggish sales. Low savings for downpayments are part of the problem, but a larger obstacle is the current state of the mortgage market.
The federal government is supporting nine out of ten loans and private lenders are lending only to the well-off but both sectors are similarly focused on borrowers with high credit scores and even FHA scores have increased substantially since 2009. Credit this tight leaves many buyers on the sidelines and now there are the new regulations that went into effect in January that are reframing the underwriting process.
Rosen said he understands the reasons behind the tight credit conditions and new Federal standards but appears to consider them an overreaction. He calls the pre-crisis period of 2004 to 2008 highly unusual in that high risk was driven by the expectation that house prices would continue to rise. When they did the exact opposite for the first time nationally since the Great Depression both risky loans and traditional ones went south and home values went negative.
There were 4.5 million foreclosures and the worst credit damage was done to low and moderate-income households. That the riskier loan structures have been eliminated is a good thing, Rosen says. But “that we have created a system where credit is limited to those who are better off is simply not sustainable going forward.” He maintains that the 2004 to 2007 bubble years, far from being the norm, were an aberration in five decades of successful lending and that more than 40 years of experience proves, credit can be mad widely available with strong underwriting and good performance.
Before credit scores dominated a lender would look at employment and other compensation factors to approve a loan. Now lenders will be looking for each borrower to achieve certain parameters for QM safe-harbor and deem other borrows ineligible. Under the old rules a 620 FICO with 5 percent down was an insurable prime loan, today 680 is the new 620. “That line of demarcation is simply too high and squeezes too many families into higher cost loans or out of the housing market completely.” He said the concern is that many low and moderate income families will be forced to remain renters, not by their own choice, but as a result of the cumulative impact of regulatory rules seeking to create a limited risk environment.
A robust primary and secondary market for mortgages is also key and after the debacle there is concern about restarting that securitization market but it is critical to broadening access to credit. “It is our belief that the combination of pooling and securitization will create good performing loans, a profitable business for the lender, attractive risk/return options for investors, and access to credit to the widest number of potential borrowers.”
Rosen said that we must acknowledge that even in the prior more open credit environment homeownership was more accessible to white, higher-income traditional family households than to minority households and all one need do today is look at studies such as one from the Harvard Joint Centre on Housing showing that communities of color will account for more than 70 percent of net household growth between 2013 and 2023 to realize that mortgage finance is simply not keeping up with reality.
Rosen recommends four changes that must be made to the current system to make it more equitable:
1. Ensuring that the Qualified Mortgage provides access to both low and moderate-income families;
2. Ensuring that pooling of risk and securitization is used to expand opportunity and create investment options;
3. Ensuring that the system builds and supports a pipeline of future home buyers willing to save and improve credit quality in pursuit of homeownership; and
4. Ensuring that the system allows access by way of loan products and terms that do not invite foreclosures.
Spring means different things to different people: outdoor activities, gardening, spring break. But for homeowners, it often means it’s time to start checking items off your home projects to-do list. From trimming trees to cleaning gutters to washing windows, spring is the time to do a tune-up on your home and clean up after Old Man Winter.
Redfin asked our real estate agents which home projects they suggest for homeowners who are considering selling their homes in the near future and want to add value. Here are the 10 projects they mentioned most frequently.
1. A new front door or garage door
a new front door or garage door is one of the best returns on investment. According to the Cost vs. Value Report, Replacing an entry door with a steel door would cost an average of $1,162 and would recoup 96.6 percent of that cost when it comes time to sell, the highest return on investment seen in this year’s report. A garage door replacement was also in the top five projects.
2. Kitchen remodel
Kitchen updates were mentioned as a valuable project by almost all of the agents we surveyed. According to the Cost vs. Value Report, a minor kitchen remodel costs an average of $18,856 and will recoup 82.7 percent. But even small improvements can make a big difference.
3. Bathroom remodel
Just like the kitchen, the bathroom is a key selling point for many buyers. A bathroom remodel will cost an average of $16,128 and recoup 72.5 percent, according to the Cost vs. Value Report. But even minor updates can make a big difference. “Replace all bathroom fixtures with brushed chrome fixtures, which instantly makes the bathroom look more current,” Simon says.
4. Replace windows
San Diego agent Cherée Bray advises homeowners to install dual pane windows. “If you have the extra money for this, they are very attractive and people really find value in them,” she says. Replacing 10 existing 3-by-5-foot double-hung windows with insulated, low-E windows costs an average of $16,798 for wood frames and $13,385 for vinyl, according to the Cost vs. Value Report. Those projects recoup 74 percent and 76.6 percent of their cost, respectively.
5. A fresh coat of paint
Painting was the project mentioned most frequently by Redfin agents. Chicago agent Sondra Savino said a client was able to make an additional $15,000 on the sale price of a home by painting the home’s exterior at a cost of about $3,000. A freshly painted front door and entryway makes a great welcoming statement for the home, and a coat of paint in a soothing color can refresh any interior space.
6. Update hardware
Just as new fixtures can bring a home into the present, updated hardware can create a modern look for a small investment. Chicago agent Nathan Brecht suggests updating hardware in the kitchen and bathroom.
Simon suggests landscaping your backyard to highlight its size and dimensions. “Cut down on any overgrown bushes and just plant a lawn with a border of small neutral flowers around the perimeter of the backyard,” she says. And “a little bark for ground cover is an inexpensive way to make a yard look taken care of,” Creech says.
8. Service all systems
9. Clean all appliances
Stone in Denver suggests that homeowners clean the oven and stove, since “dirty appliances give a wrong impression.” When you decide to sell, do a thorough cleaning of any appliances.
10. Minimize and declutter
Stone advises homeowners to make rooms seem bigger by getting rid of belongings, and to remove as much as possible off of flat spaces: countertops, vanities, the top of the refrigerator, shelves, etc.
“Anything reaching to the ceiling makes the room feel smaller,” he says.
Freddie Mac and its economists would like to answer the old question “are we there yet?” with “there” in this case meaning anywhere close to a normal housing market. As part of that goal, the company today premiered a new tool, the Freddie Mac Multi-Indicator Market Index (MiMi). This new publicly-accessible tool monitors and measures the stability of the nation’s housing market, as well as the housing markets of all 50 states, the District of Columbia, and the top 50 metro markets.
MiMi uses proprietary Freddie Mac data, combining it with information on local markets in order to calculate a range of equilibrium for each single-family market tracked. The user will be able to see at a glance where each market stands relative to its stable range and where each market is trending in relation to that range – is it falling away by failing to generate enough demand to balance the market or by overheating to an unsustainable level.
Freddie Mac’s Chief Economist Frank E. Nothaft said it has been more than seven years since the beginning of the deepest housing recession since the Great Depression and the nervous speculation about when, if ever, housing would get back too normal. “Given the pickup in sales, new construction, and home values over the past couple of years, it’s fair to ask if we’re there yet: is the U.S. housing market back to a normal range of activity with a good balance between demand and supply forces?”
“MiMi is the right housing index at the right time as we once again transition to a purchase-dominated housing market,” Nothaft said. “With recent history demonstrating that housing activity differs substantially from market to market, MiMi offers a fresh perspective on housing at the local level just as we are entering this new purchase market landscape. MiMi helps to pinpoint each market’s ‘sweet spot’ by focusing on local housing differences while also tracking the fundamentals necessary for a stable market. MiMi draws from multiple data sources — including Freddie Mac proprietary data generated through our daily business with more than 2,000 mortgage lenders across the country — to create current insights into how the housing market at the national, state, and local level is trending.”
Data used by MiMi to assess where each market is relative to its own long-term stable range includes home purchase applications, payment-to-income ratios (which allows measurement of changes in home purchasing power), proportion of on time mortgage payments, and the local employment picture. The four indicators are combined to create a composite MiMi value for each market.
Nothaft said that housing is clearly stronger today than at any point since the Great Recession began with home sales up 13 percent from the 2009 trough, housing starts up 55 percent, and serious delinquencies down 32 percent. The unemployment rate has dropped nearly three percentage points, “though at a stubbornly slow pace.” But he asks, “Has the market recovered, is it still recovering, or (as some claim) is it overheating into a new bubble?”
Developing MiMi meant reviewing the various definitions of a “normal” housing market. The economists rejected definitions pegging normal to the peak of the last market as too vague, since peaks are inherently unstable, and unhelpful from a responsible business perspective, using instead current and historic data to define a “normal” market as one where there is a stable range of housing activity. They then used this stable definition for each market to create an index which can measure, monitor, and graphically show where each is today in relation to their stable ranges and recent past.
Freddie Mac Deputy Chief Economist Len Kiefer said the first MiMi illustrates some themes for the nation’s improving housing markets. Many show a better employment picture along with some income growth making it possible for more people to buy a home while staying within reasonable debt-income ratios on their mortgages. “But some high cost markets are already starting to feel an affordability pinch,” he said, while at the same time, “those markets with a strong energy-related presence are posting solid house price gains supported by employment and wage growth. Conversely, many markets are still in recovery mode with ground to make up.” Kiefer said that only four of the 50 metro areas tracked by MiMi are in range with this issue, but 35 are improving and as the spring homebuying season rolls out, “we hope to see recent trends continue with more markets moving closer to their long-term stable range.”
, year-over-year sales Feb 2014 vs Feb 2013 were negative for the first time since September 2011. At that time, annual momentum was in the process of improving, and the only other post-crisis move into negative territory came after the homebuyer tax credit expiration in 2010. That means today’s data is the first move from an established positive trend into negative territory since 2006.
On a non-seasonally adjusted basis there were an estimated 35,000 homes sold during the month, leaving an unsold inventory of 189,000–slightly higher than January’s revised 188,000 homes. Taken together with the slower rate of sales, The Census Bureau says this accounts for 5.2 months’ supply of New Homes compared to a revised 5.0 months’ supply in January (4.7 months before revisions).
The improvement in sales was driven entirely by activity in the Midwest where new homes sold at the rate of 67,000 units, up 36.7 percent from January and 1.5 percent above sales in February 2013. If that seems odd, don’t worry… The month-over-month margin of error is only ±72.5 percent (meaning the 67k homes sold could really end up being anywhere from 18k – 115k). Strip out that sort of volatility and we’re seeing a stagnant trend of 440k-460k in place since the beginning of 2013.
While average prices continued higher thanks to high-end homes, median prices fell to $261.8k from $265.1 in Feb 2013. That’s the first move into negative territory since mid 2012 and further evidence of the sideways grind. Other home price metrics out today spoke to January’s data, but told a distinctly different story. The average year-over-year gain was 13.2 percent according to Case Shiller and 7.4 percent according to FHFA, Fannie and Freddie’s regulator.
Mortgage rates moved higher for a second straight day, extending yesterday’s much larger spike. Some lenders remained relatively close to yesterday’s latest offerings while others were in noticeably worse shape. Market volatility tends to create variation in pricing strategies between lenders, and while volatility was limited today, its effects are still being managed.
Every Thursday, Freddie Mac releases its weekly mortgage rate survey–the most widely circulated official reading on mortgage rates. While Freddie’s survey is extremely accurate over time, it’s also extremely outdated in the short term. This has to do with the Monday-Wednesday time frame that responses are accepted. If rates happen to rise quickly on Wednesday afternoon or Thursday morning, the Survey can be rendered utterly useless to prospective borrowers as it now refers to rates that are no longer available.
This is unfortunately the case today as rates did, of course, rise exceptionally quickly yesterday, and less so today. While the Freddie Survey shows rates moving lower week-over-week, they’ve actually haven’t improved any day this week! Based on the average rate over the past 4 days, this week’s rates are only 0.03-0.04 higher than last week’s average, but a whopping 0.17% higher from Friday.
The most prevalently quoted conforming 30yr rate for top-tier scenarios (best-execution) moved up to 4.5% yesterday and while there is still slightly more activity there, we’re already dangerously close to 4.625% today. When adjusted for day to day changes in closing costs, rates are 0.03% higher on average today, and 0.13% higher over the past 2 days.
As promised last week, the leadership of the Senate Banking Committee has released draft legislation to revamp the nation’s housing finance system. Chairman Tim Johnson (D-SD) and ranking member Mike Crapo (R-ID) said their draft builds on S 1217, the Warner-Corker bill submitted last year. Johnson and Crapo said their draft is designed to protect taxpayers from bearing the cost of a housing downturn; promote stable, liquid, and efficient mortgage markets for single-family and multifamily housing; ensure that affordable, 30-year, fixed-rate mortgages continue to be available, and that affordability remains a key consideration; provide equal access for lenders of all sizes to the secondary market; and facilitate broad availability of mortgage credit for all eligible borrowers in all areas and for single-family and multifamily housing types.
The proposed legislation winds down and eventually eliminates Fannie Mae and Freddie Mac (the GSEs), replacing them with an entity called the Federal Mortgage Insurance Corporation (FMIC). This agency will be modeled in part on the Federal Deposit Insurance Corporation (FDIC) which will create and manage a Mortgage Insurance Fund and regulate member entities.
The new system establishes a type of mortgage-backed security with an explicit government backstop and a “10% first loss” for private secondary market capital to absorb losses and protect taxpayers from future bailouts. In general, these securities will be executed in the following manner:
- Originators will underwrite mortgages for homebuyers and sell eligible loans into the secondary market.
- Aggregators will pool the mortgages they purchase or originate, obtain a guarantee from a guarantor or a credit enhancement through a capital markets execution, and deliver the pool to a Securitization Platform. A mortgage-backed security (MBS) would then be issued with a FMIC-backed government guarantee.
- The Guarantor will hold 10% capital and provide a guarantee on MBS. The government backstop only applies when the guarantor fails.
- Investors hold fully-funded first loss positions of at least 10% of the mortgage-backed security’s value, putting private capital in front of the government guarantee. All types of capital markets mechanisms must be approved by FMIC.
FMIC is designed to be a strong regulator with supervision and examination powers and will have authority to approve and supervise guarantors, aggregators, and private mortgage insurers (PMIs) who want to participate in the new system and will have enforcement powers sufficient to pursue any violations by those it regulates. FMIC will also have authority to set standards for servicers of eligible mortgage loans that must not disadvantage small servicers
FMIC will be managed by an accountable, independent bipartisan board of directors. The board of five members will be appointed by the President and confirmed by the Senate. No more than three members of the board may be members of the same political party. There will also be a nine-member advisory committee made up of housing industry stakeholders to provide input and advice to the board of directors and the Office of Consumer and Market Access.
FMIC underwriting standards will be robust and mirror the definition of “qualified mortgage“, and set the down payment requirement at 3.5% for first time homebuyers and at 5.0% for other homebuyers. The latter will be phased in over a short time period.
The Securitization Platform will be an independent entity, acting as a utility, owned and operated by its members and regulated by FMIC and managed initially by a five-member board of directors comprised of Platform members and established by FMIC. After the initial terms expire the board will be comprised of nine elected directors made up of representatives of Platform members, at least one of whom must represent small mortgage lenders, and one member an independent director.
Fees would generally be uniform and based on member usage of the Platform. Platform directors will have the discretion to set tiered usage fees that will facilitate access for small mortgage lenders, and organizations that promote the goals of affordable housing; and set different usage fees for issuance of FMIC and non-FMIC securities. In addition to aggregators, originators, and guarantors, membership in the platform would be open to Federal Home Loan Banks, small lender mutuals, and other market participants deemed by the directors to be necessary or helpful to the purposes of the Platform.
All FMIC securities using the Platform will be required to use a Uniform Securitization Agreement for FMIC guaranteed securities while non-FMIC securities will be required to use one of several optional agreements suggested in the legislation that include a common set of basic contractual terms.
Under the legislation small lenders will have multiple access points to the secondary market, including the option to sell individual loans through a new small lender-owned cooperative or “mutual.” This would provide community banks, credit unions, and other small lenders direct access to the secondary market outside of direct competition with larger competitors when the GSEs are dissolved. The mutual will provide members with a cash window in which to sell individual, eligible mortgages, pooling, aggregation and securitization services; and assistance in retaining servicing rights.
The small lender mutual will be governed by a board of directors selected from its membership. The mutual board has authority to set membership standards and fees which must be equitably assessed regardless of member size, loan volume, or entity type.
The legislation eliminates the affordable housing goals of Fannie Mae and Freddie Mac and establishes an Office of Consumer and Market Access (OCMA) within FMIC which will be responsible for administering the Market Access Fund, monitoring markets to determine which are underserved, and reporting on the FMIC on securities market and available liquidity, and conducting studies on incentives to encourage the serving of underserved markets,
The draft acknowledges the importance of the multifamily rental market and provides that during the transition period the GSEs will be permitted to continue to offer financing to that market. At the same time they are each charged with laying the groundwork for a future system by establishing distinct multifamily subsidiaries.
FMIC will approve multifamily guarantors to both guarantee the first loss position on multifamily securities and issue securities for which they provide guarantees. The successful mechanisms currently offered by the enterprises, the DUS and Series K products, can be used by approved multifamily guarantors in the new system. Approved multifamily guarantors will have 10% capital requirements standing before the public guarantee.
Each enterprise and approved multifamily guarantor must ensure that 60% of the rental housing units financed are affordable to low-income families (families with incomes at or below 80% of Area Median Income) at origination although FMIC may suspend or adjust this requirement to meet adverse market conditions. The bill also establishes a pilot program in FMIC’s Office of Multifamily Housing to test and assess methods or products designed to increase secondary mortgage market access for small (under 50 units) multifamily properties
The bill also contains provisions to support existing affordable housing allocations such as the Housing Trust Fund, support rural and tribal housing needs, and promote lending initiatives to address the needs of underserved communities. It will also allow current conforming loan limits to be maintained so that mortgage credit continues to be available in high-cost areas.
The measure will allow consumers the certainty of locking-in interest rates prior to closing on a home and ensure the availability of the 30-year fixed-rate mortgage by maintaining broad liquidity in the To-Be-Announced (TBA) market. It also directs FMIC to take into account the impact of new products on the TBA market.
In order to ensure a smooth transition to a new housing finance system the draft allows for five years to put the new system in place and allows for extensions if necessary. It creates a framework to simultaneously ramp up the new system while winding down the GSEs. Six months after the law is enacted the Federal Housing Finance Agency’s (FHFA) functions, powers, and duties are transferred to FMIC, and FHFA will exist as an independent office within FMIC, continuing to be responsible for supervision and regulation of the GSEs and the Federal Home Loan Banks. As of FMIC’s certification date, Fannie Mae and Freddie Mac will no longer be able to conduct new business and assessments will be collected from the GSEs to fund the operations of FMIC. A Transition Committee will be formed to advise the FMIC Transition Chair or the FMIC Board of Directors. .
The bill contains a number of provisions, some of which has been detailed above, to protect taxpayers.
- All future MBS guarantors would be completely private and be required to hold a minimum of 10% private capital. The bill further prohibits bailing out any of these institutions in the event that they fail.
- To be eligible for FMIC reinsurance, any market structured mortgage-backed security must first secure private capital in a first loss position of at least 10%.
- Strong underwriting provisions will be put in place including higher downpayment requirements and an ability to repay requirement.
- The proposed Mortgage Insurance Fund maintained by FMIC will be funded by private companies that choose to participate in the new housing finance system, not by taxpayers.
The bill’s drafters say the new system protects taxpayers and levels the playing field for all creditworthy borrowers, includes strong, market-based incentives for lenders to support the housing market in underserved communities, and provides certainty to investors and homeowners through standardization and improved market liquidity.
Article by Jann Swanson
The strong uptick in mortgage applications during the week ended February 28 faded quickly and the Mortgage Bankers Association (MBA) said today that application volume has resumed the downward trajectory that has prevailed since late last fall. According to MBA’s Weekly Mortgage Applications Survey the Market Composite Index, a measure of mortgage volume decreased 2.1 percent on a seasonally adjusted basis from the week before and down 1 percent on an unadjusted basis.
The Refinance Index fell 3 percent week-over-week and refinancing garnered a 57 percent share of mortgage activity, down from 57.7 the previous week. The refinancing share is off 6 percentage points from the level at the beginning of the year and is at the lowest point since April 2011.
Refinance Index vs 30 Yr Fixed
The seasonally adjusted Purchase Index was 1.0 percent lower and the unadjusted Purchase Index was 1.0 percent higher than in the week ended February 28. The unadjusted index was 17 percent below that of the same week in 2013.
Purchase Index vs 30 Yr Fixed
Both contract and effective interest rates rose for all mortgage products during the week. The average contract rate for conventional (loan balances under $417,000) 30-year fixed-rate mortgages (FRM) was 4.52 percent with 0.29 point. The previous week the rate was 4.47 percent with 0.28 point.
The average rate for the jumbo version of the 30-year FRM (balances in excess of $417,000) was 4.41 percent, an increase of 4 basis points from the week before. Points were unchanged at 0.20.
FHA backed 30-year FRM had an average rate of 4.18 percent with 0.21 point. This was an increase from the prior level of 4.13 percent with 0.13 point.
The average contract interest rate for 15-year fixed-rate mortgages increased to 3.53 percent from 3.52 percent. Points increased to 0.28 from 0.18.
Adjustable rate mortgages (ARMs) had an 8 percent share of mortgage applications which has been essentially unchanged for the last eight weeks. The average contract interest rate for 5/1 ARMs increased to 3.18 percent from 3.09 percent, with points decreasing to 0.36 from 0.38.
MBA’s survey covers over 75 percent of all U.S. retail residential mortgage applications, and has been conducted since 1990. Respondents include mortgage bankers, commercial banks and thrifts. Base period and value for all indexes is March 16, 1990=100 and interest rates are based on loans with an 80 percent loan-to-value ratio. Points include the origination fee.
Mortgage rates continued holding mostly sideways today, though there were enough lenders in slightly better shape to make for a small improvement on average. Just keep in mind that things may vary from lender to lender when comparing to yesterday’s latest offerings. Some will be worse and a bit more than half will be better. 4.5% remains the most prevalently quoted conforming 30yr Fixed rate for the best-qualified borrowers (best-execution). When adjusted for day-to-day changes in closing costs, rates moved lower by an equivalent of 0.01% today.
For a second straight day, the bond markets that underpin mortgage rate movement had precious little data to motivate movement. While headlines out of the Senate on potential legislation to wind down Fannie and Freddie did have an effect on MBS (the ‘mortgage backed securities’ that most directly affect rates), it wasn’t enough to make for much of a change versus yesterday’s rate sheets. It was also somewhat offset by falling stock prices and Treasury yields, which helped MBS bounce back into the afternoon.
Risk and reward for locking and floating are subdued in this environment. If you wait to make your decision beyond today, you’re essentially waiting to see if Thursday’s economic data will support last week’s stronger reading on employment. If it does, rates could once again move to challenge recent highs. Other wild cards include potential Ukraine headlines (which haven’t done much to help rates so far this week) and the possibility of further losses in equities (which have been helpful to some extent). Neither of these are high enough probability bets to be worth much risk, but if you’re inclined to float, you can simply use the recent highs seen on Friday as a ‘stop-loss,’ such that if rates move any higher, you’d lock at a loss. The biggest risk to this strategy is that the ‘break’ could be abrupt if it coincides with strong economic data on Thursday.
Mortgage rates leveled-off today, after rising to 2-month highs after last Friday’s Employment Situation (‘Jobs Report’). Today’s rates were just slightly lower, but apart from Friday, were as high as they’ve been since early January for most lenders. 4.5% remains the most prevalently quoted conforming 30yr Fixed rate for the best-qualified borrowers (best-execution). When adjusted for day-to-day changes in closing costs, rates moved lower by an equivalent of 0.02% today.
In terms of scheduled events that could have an effect on rates, this week begins slowly and remains slow until Thursday morning. That doesn’t mean that financial markets won’t see enough volatility to push rates higher or lower–simply that such volatility would not immediately follow an important scheduled event as it did on Friday. It is positive to see resilience today, considering strong movement after the monthly Jobs Report tends to create lasting momentum more often than not, but it’s too soon to rule that out based on one day of holding ground.
Today’s Best-Execution Rates
- 30YR FIXED – 4.5%
- FHA/VA – 4.00%
- 15 YEAR FIXED – 3.375%
- 5 YEAR ARMS – 3.0-3.50% depending on the lende
Job creation ramped up somewhat in February, posting a better than expected gain of 175,000 despite expectations that weather would keep the count low. The unemployment rate edged higher to 6.7 percent, according to the latest report from the Bureau of Labor Statistics.
Economists polled by Reuters expected the U.S. economy to have created 149,000 jobs in February, up from 129,000, which was revised higher from 113,000.
Employment growth had waned over the past two months, and February’s number, while an improvement, remains below where it had been for the past year, during which monthly job creation has averaged 189,000.
A separate measure of unemployment, which includes discouraged and underemployed workers, edged lower to 12.6 percent from 12.7 percent.
“This sort of number today helps to start fuel sentiment towards growth going forward a little bit. And that change in people’s expectations for growth I think is a bigger factor for equities than the absolute growth itself,” Bessemer Trust CIO Rebecca Patterson told CNBC.