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strong jobs report sent mortgage rates soaring on Friday, potentially reversing a trend of stabilizing rates and increasing borrowing costs for buyers as the homebuying season winds down. Key points include:

    The September jobs report showed an unexpected surge in employment, with 254,000 new jobs added, significantly higher than August's revised increase of 159,000. The unemployment rate dipped to 4.1%. Wages rose 4%, exceeding expectations.

    As a result, mortgage rates jumped, with the 30-year rate reaching 6.53% on October 4, up from 6.26% the day before. Rates are expected to continue fluctuating but should end the year around 6.2%.

    The jobs report may be a mixed blessing for the industry, as more jobs mean increased demand, but rising mortgage rates come at a time when many consumers and real estate agents anticipated them to fall. This could dampen home sales in the coming weeks.

    Despite this, wages are outpacing inflation, improving housing affordability for some buyers. The construction industry is also growing, with residential employment reaching 3.4 million and average monthly job gains of 3,450. However, other factors like consumer confidence and the hiring rate will influence the housing market in the fourth quarter.

    The Federal Reserve may still cut short-term interest rates, but with more caution, following the strong jobs report. The upcoming inflation report will help dictate their next move, with a possible 25-basis point reduction remaining on the table.