Where is the residential real estate market heading?
Posted on Thursday, August 25, 2016 at 4:18:09 PM
Economists, investors and consumers alike have kept a close eye on the residential real estate market since it began to rebound from the crisis. Considering how important this area of the economy is with respect to overall health, there has been plenty of reason to feel comfortable throughout the past two years or so. Construction has thus far lagged behind the figure recorded before the recession, but virtually every other aspect has come a long way.
This includes greater access to residential financing, higher home values, increased equity and a seller's marketplace. What's more, the fact that home improvement projects have been booming for more than a year - and are expected to continue rising - certainly bodes well for the market as a whole. However, all of these changes might evoke curiosity in the average home buyer's mind as to how the market will play out in the next couple of years.
Plenty of reason for hope
Whereas refinancing applications were bolstered in the mortgage arena for a while, Bankrate reported that the latest data from the Federal Reserve indicated that the number of home loan applications surged in the second quarter compared to the first quarter of 2016. At the same time, the end of the quarter was truly a positive one, as the source cited the Department of Commerce's report that revealed a 12.4 percent increase in the number of new homes sold.
The biggest problem remains the availability of real estate, though, but this might not be the case for much longer. According to the news provider, as more prospective buyers struggle to find available real estate - yet have the capital and financing necessary to make a purchase - there will most likely be an upturn in residential construction starts.
"This rise in new home sales is consistent with our builders' reports that market conditions have been improving," National Association of Home Builders Chairman Ed Brady explained. "As existing home inventory remains flat, we should see more consumers turning to new construction."
There is no telling when interest rates are going to begin to rise on residential loans. As such, right now is a great time to apply for a residential financing program, and working with a local, community bank can help to ensure that the best possible option comes to light and is acquired.