Homeownership rate declined, but positives remain in market
Posted on Wednesday, August 6, 2014 at 9:26:06 AM
The housing market has been full of ups and downs over the past several years. While homeowners and buyers may be growing tired of the fluctuations, there remain a number of positives that could be signs of improvements around the corner.
For example, residential financing demand is on the way up and rates are near historic lows. Even so, financial advisory firm NewOak explained that homeownership rates are declining, driven in part by a lack of first-time buyers. Where once college graduates flocked to the market, now many are holding off due to student loans and other debt. Mortgage underwriting standards and job growth also leave something to be desired.
However, the current housing market may not be all negative. According to The Wall Street Journal, a slowdown could actually be a plus for homebuyers. This is because it will lead to slower price gains and lower interest rates, all helping out affordability, not hurting it.
"From an individual perspective, the best investment you can make is to buy a primary residence," John Paulson, leader of the hedge fund Paulson & Co., told the media outlet. "Today financing costs are extraordinarily low. You can get a 30-year mortgage somewhere around 4.5 percent."