Mar 29, 2016
Real Estate Home Buyers News
While the prevailing conclusion is that the economy has not fully recovered from the recession of almost ten years ago, there are certainly some aspects of the economy that have shown signs recovery.
This unfinished recovery is also true in the real estate industry. Home prices are definitely showing signs of recovery, with the average price of homes in many areas of the country now back at levels reached during the peak of the real estate boom. On the other hand, unfinished recovery on the supply side is affecting the numbers of homes available for sale and adding additional upwards pressure to home prices.
Factors of the unfinished recovery directly related to the availability of homes for sale would include; Baby boomers due to losses sustained during the downturn or lack of confidence in the recovery are delaying retirement and scaling down to the condo on the beach and are holding on to their single family home much longer.
Builders are not building new homes at the same pace as before the crash; actuality they are reporting a shortage of skilled labor.
Based on population growth during the past decade the underlying demand for housing may be higher than available supply for several years, providing additional upwards pressure to home prices. To avoid repeating the past, it is essential to address this shortage and the pressing issue that America will need a greater supply of homes to house our growing population in the future.
The Markets
- Rates on home loans inched higher again in the past week.
- Freddie Mac announced that, for the week ending March 17, 30-year fixed rates rose to 3.73% from 3.68% the week before.
- The average for 15-year loans was also moderately higher at 2.99%.
- The average for five-year adjustable rate loan increased slightly to 2.93%.
- A year ago, 30-year fixed rates were at 3.78% very close to today’s levels.
Rates indicated do not include fees and points and are provided for evidence of trends only. They should not be used for comparison purposes.
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