August 11, 2026 – Its All These Two Factors

Economic Commentary

Sure, there is a lot more to the economy than these two factors. But we can’t think of two headlines which have garnered more attention this year. Obviously, the Iran situation affects the economy, and the next result of the conflict has been higher energy prices, rising interest rates and flagging consumer confidence. But overall, the economy has kept moving forward, buoyed by a resilient stock market.  The employment sector is a primary indicator of the health of the economic sector. That is why last week’s report was being watched so closely.

So how did the employment report come out?  The economy lost 23,000 jobs in June.  This number was significantly below expectations. In addition, the previous two months of job gains were revised downward by 103,000 jobs, making the net loss for the month 126,000 jobs. Despite the loss of jobs, the unemployment rate fell by 0.1% to 4.1%, which is a continued anomaly related to the sluggish workforce growth.  On the inflation front, wage growth increased by 3.2% annually, lower than expected. Overall, this was seen as a weak report and creates additional concern regarding the economy overall at a time when the conflict overseas remains a major factor contributing to this concern.

Which leads us back to the conflict in Iran which has spread throughout the Middle East. After weeks of heavy attacks and counter attacks, it appears that the parties have started talking again and a cease fire could be in the works. Of course, we have heard and lived through this story several times before. Let’s hope cooler heads will eventually prevail, and a ceasefire becomes the basis for a permanent truce. The markets could use some good news because we are due for the July inflation reports this week and it is not likely that this news is going to be good. Remember, the markets are not reacting to what happened last month, they will react to what they think will happen next month. That’s where hope comes in.  The phrase “hope is eternal” means that optimism never dies!

Weekly Interest Rate Overview

The Markets. Mortgage rates started to ease this week as news of an agreement to open the Strait of Hormuz was circulated, though 30-year rates rose slightly from last week.  According to the Freddie Mac weekly survey, 30-year fixed rates rose to 6.69% last week from 6.66% the previous week. In addition, 15-year rates decreased to 6.01%. A year ago, 30-year fixed rates averaged 6.63%, 0.06% lower than today. Freddie Mac noted that, while mortgage rates continue to influence affordability, the housing market is showing signs of adjustment, with listing prices modestly below year-ago levels and for-sale inventory improving from the limited supply seen in recent years. Note: Rates indicated do not include fees and points and are provided for evidence of trends only. They should not be used for comparison purposes.

Real Estate News

The spate of wildfires, hurricanes, tornadoes and floods fueled by man-made climate change that have plagued vast swaths of the country in recent years is changing the housing industry. That’s because people who are seeking to rebuild in disaster-prone regions are searching for greater peace of mind. As a result, they’re turning away from stick-builds and embracing prefabricated homes that are made using materials that are fire-resistant and can withstand extreme weather, and that are now considered standard, and are often more affordable.  Manufacturers are meeting that demand with innovative and safer alternatives. Many companies are designing prefab houses that can withstand category 5 hurricane winds — up to 250 mph — earthquakes, hailstorms, massive snowfall and fire. Depending on customizable preferences, prices can vary from below $100 per square foot to over $500 per square foot, excluding land. But even those prices often fall under traditional on-site building costs in many parts of the country. The Manufactured Housing Institute reports that as of 2024, nearly 21 million people in the U.S. live in manufactured or mobile homes. Manufactured homes made up more than 9% of new home starts in the same year. Meanwhile, consumer prices have remained largely unchanged over the past three years, making them increasingly attractive to first-time buyers.  Given the escalating climate risks across the country, Harrison Langley, CEO of MDLR Brands, believes that traditional on-site building is unsustainable. His company has built single-family prefabricated homes, apartment buildings and commercial structures following 2019’s Hurricane Dorian in California, Tennessee and North Carolina. Source: NPR

Redfin released a survey querying why U.S. residents might be looking at out-of-state moves. The top reason reported by movers was weather, at 22%. No. 2 was concern about climate change, at 21%. Next were concerns about safety/crime at 20% and moving for a job or job relocation at 19%. Reported at 18% each were folks looking to be with/nearer to family, for lower overall cost of living and to upgrade to a better home or neighborhood. Rounding out the top 10 were wanting more space (16%), concerns about job security (15%) and for lower rental/home prices (15%). Americans searching for better weather are consistently moving from the northern parts of the U.S. to areas like Florida, Las Vegas and Sacramento. Of the respondents who are planning to move out of state, 14% are moving to Florida, 13% are moving to Texas and 11% are moving to California. “Many movers are looking for a location that aligns with their ideal lifestyle, and weather can play a meaningful role in that decision,” said Redfin Economist Yingqi Xu. “Whether it’s escaping harsh winters, the desire for year-round outdoor recreation or looking to sunshine as a mood booster, weather is an important consideration for many Americans who are relocating.” But movers within their current state point to different reasoning. For those respondents, 29% say they’re seeking a better home or neighborhood and 29% say they want more space. Twenty-one percent say they are concerned about safety or crime, 14% are concerned about natural disasters or climate risk and 9% are looking for better weather.  Source: Redfin

There are two kinds of homebuyers: those with pets and those without. And for pet owners, a home purchase can hinge on whether a listing works as well for their pet as it does for them, according to new data. A new survey from Realtor.com® finds that buyers with pets often evaluate homes through an animal-first lens, prioritizing features like a secure outdoor space, durable interiors, and communities where pets are allowed.  “I see pet needs influence decisions all the time,” echoes Miltiadis Kastanis, executive director of sales at Compass. “A buyer might really like a home, but if it does not feel right for their pet, whether it is the lack of outdoor space or the overall environment, they will walk away.” For many buyers, pets were not a side consideration but a real force in the home search—one strong enough to shape decisions and even justify paying more for the right features.  The survey answers pointed to a strikingly consistent definition of what makes a home truly pet-friendly: secure outdoor space, durable and easy-to-clean interiors, and neighborhoods or developments where pets are clearly allowed. “Pet friendly means having a good-sized backyard that is secured well with a fence or wall,” said Katey, a millennial first-time homebuyer.  And when buyers find those features, some are willing to pay more for them, the research found—a reality that agents say mirrors what they see in home searches every day. And that demand didn’t stop at closing. The survey found that while many buyers didn’t make major pet-related changes after moving-in, others invested in upgrades that made the home more durable, convenient, or comfortable for their animals.  Source: Realtor.com®