Market Update: Govt. Shutdown
Market Update: Jobs, Rates, and the Government Shutdown
It feels like every week there’s something new to unpack — and this one’s no different. Between the government shutdown, the latest jobs report, and what’s happening with rates, there’s a lot of noise out there. My job is to cut through it and give you the takeaways that actually matter for you if you’re buying, selling, or just trying to make sense of today’s housing market.
Market Update: Jobs, Rates, and the Government Shutdown. Written By: Joseph S. Faurie
The Jobs Report: Signs of a Slowdown
The ADP jobs report came in weak again, showing a trend of slowing job growth. This isn’t just a one-off — it’s been happening throughout the year.
Manufacturing jobs are being lost.
Residential construction jobs, especially contractors, are being lost.
Overall, job growth is noticeably slower than last year.
For the Fed, this puts them in a tough spot. They’ve made it clear they’re okay with “zero to 50,000 jobs added per month” as long as the broader economy holds up. And right now, GDP is still above 3% and consumer spending is steady. So while the labor market is softening, the Fed doesn’t seem ready to change course yet.
Rates and the Bond Market
Even with weaker jobs data, the 10-year Treasury yield is still holding above 4%. That means mortgage rates aren’t dropping as fast as some might hope. But the bond market looks more stable this year compared to last year — less overreaction, more discipline.
Bottom line: unless jobless claims (unemployment filings) start climbing quickly, don’t expect big rate cuts just yet.
The Government Shutdown and Housing
Here’s where things hit closer to home: the shutdown is slowing down about 1,500 real estate transactions per day. Why?
The IRS can’t process income verifications (4506-T forms), which lenders use to confirm borrower income.
The National Flood Insurance Program expired on the exact same day, adding more headaches for closings in flood zones.
For most buyers, this will causedelays, not cancellations. But if you’re in escrow right now, it could get frustrating. The good news is, if this shutdown is short-lived, these issues will clear up quickly.
Purchase Applications: A Bright Spot
On the flip side, we’ve hadnine straight weeks of positive purchase application datacompared to last year. Applications are up 16% year-over-year, even with higher rates. That tells us buyers are still stepping into the market, especially as they adjust to today’s “normal” rate environment.
If this trend continues for a few more weeks, it could translate into stronger home sales data later this year.
Key Takeaways
Jobs are slowing down— a sign the economy is cooling, but not collapsing.
Rates are steady, not dropping quickly, because the Fed is staying cautious.
The government shutdown is causing short-term delaysin closings, especially around IRS verifications and flood insurance.
Buyer activity is rising— applications are showing steady growth, even with higher rates.
My Advice
If you’re in the middle of buying or refinancing, be prepared for a little extra patience while the shutdown plays out. If you’re still on the sidelines, remember: waiting for the “perfect” moment usually means missing opportunities. The best move is to run the numbers for your situation now, so you know where you stand.
As always, if you want to know how these market shifts impactyour specific scenario, let’s connect. Whether it’s getting pre-approved, running payment options, or just talking through strategy, I’m here to help.
