Home sales slow down, price gains expected to taper
Posted on Tuesday, December 24, 2013 at 9:40:28 AM
The hot U.S. housing market may cool a little over the next year, but recent data still has plenty for homeowners and those interested in residential financing to get excited over.
According to Freddie Mac's U.S. Economic and Housing Market Outlook, many homes across the U.S. are still considered affordable. The 30-year fixed-rate mortgage is near a 4.4 percent interest rate, which doesn't price out many buyers at the moment. More than 70 percent of the North Central region is considered affordable, compared to only 36 percent out west.
Better yet, Freddie Mac reported that existing homeowner's housing payment-to-income ratio declined to its lowest figure since 1980, which means that owning real estate is currently a more sustainable task.
However, Frank Nothaft, vice president and chief economist for Freddie Mac, said in a statement that higher residential financing rates and home prices could create problems in the future for borrowers.
Even so, the International Business Times forecasted a slowdown in U.S. home price gains over the next few years. This could be good news, as the market will become more moderate and mortgage-dependent buyers will increase their activity.