You may recall an article here early last month about the August jobs picture. The unemployment report and job creation during that period was rather tepid. Lousy some would say. Economists had expected August to Unemployment Rate Holds Steadycreate somewhere
 around 200,000 new jobs but instead only 136,000 were counted. It was pointed out that for some reason employers were lax in reporting new job numbers due to any variety of reasons but several times in recent past this low-jobs anomaly corrects itself in the following month. No such luck.

According to the latest unemployment report and non-farm payroll count, while the unemployment rate held steady at 5.1% there were a paltry 142,000 yet the expected number was something closer to 205,000. July numbers were also revised downward to 136,000. That’s three straight months of sub-200,000 jobs and points to a weaker economy than previously thought. This is straight off the heels of the latest FOMC policy meetings some two weeks ago. The Fed will next meet at the end of this month to consider raising rates but with the jobs the way they have been those that were expecting a rate increase in October are now thinking otherwise. A rate move in December is now in doubt of the Fed, in spite of Fed Chair Yellen’s earlier comments that there will be a rate increase in 2015.

 

This bodes well for real estate investors as financing costs should continue to remain historically low at least into the first or second quarter of next year. Demand for rentals is still strong which can only mean higher rents. We’re going to ride this train as long as it keeps running and without any clear indicators the economy is back on its feet in a big way, rates should stay low for some time.