Nonbank mortgage employment inches down as housing market loses steam
The number of workers employed by nonbank mortgage lenders and brokers reversed course and inched lower in July, as affordability constraints and limited income gains reduced demand.
There were 345,300 people employed by nonbank mortgage brokers and lenders in July, according to the Bureau of Labor Statistics. A month earlier, there were 345,400 people employed by nonbank mortgage production companies.
The slight decline follows three months of seasonal nonbank mortgage employment gains.
"The combination of higher home prices and mortgage interest rates have made housing less affordable, so income gains are needed to get the housing market back on track," Len Kiefer, Freddie Mac's chief economist, said in a press release.
While there was some weakness in income gains in July, year-to-year increase in hourly earnings just shy of 3% in August could help make homes more affordable and improve mortgage employment going into the fall, he added.
"The solid labor market should help to support a housing market that sagged a bit over the summer," Kiefer said.
Although the number of workers employed by the nonbank mortgage production industry was lower on a consecutive month basis in July, it was up from the previous year. In July 2017, nonbank mortgage lenders and brokers employed 339,100 workers.
National employment estimates, which the nonbank mortgage broker and lender estimates lag by a month, show there were 201,000 jobs added across all industries in August. In comparison, U.S. employers added 147,000 jobs in July and 208,000 jobs in June. The June and July number were subject to downward revisions.
The U.S. unemployment rate in August was 3.9%, the same as in July. A year ago, the unemployment rate was 4.4%.