The housing market is recovering. As more home buyers are taking advantage of the improved affordability conditions. With mortgage rates hovering around recent record lows and home prices having generally stabilized, economists are expecting an upward trend to a healthy and sustainable level in 2011.
Encouraging signs are showing up across the economy. Retail sales recently hit their highest level since before the recession. Key measures of small and big businesses’ optimism marched back up to prerecession levels and new claims for jobless benefits are trending lower. Together they bode well for steady job creation and improved consumer confidence which is generally manifested in more spending.
As the economy improves, current stimulus efforts by the government and the Federal Reserve Board are expected to gradually wind down. Meanwhile, serious buyers stand to benefit from historically favorable buying conditions.
Mortgage rates are inching up but remain historically low. This trend continues to support home buying as it translates to significant savings for buyers. As overall economic recovery remains on track, rates are expected to rise to keep inflation in check.
Source: Freddie Mac
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Real Estate News Updates Week Ending 1/2/2011:
7 Morgage Trends for 2011 | Investopedia
Can The Stockmarket Have A ‘Home-Less’ Recovery? | CNBC
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Real Estate News Updates Week Ending 12/26/2010:
Fannie Mae Boost Economic Outlook For 2011 On Several Factors | Fox Business News
Fannie Mae, Freddie Mac: Foreclosures Double Modifications In 3rd Q | Housing Wire
Rising Mortgage Rates Spur First Time Home Buyers In November | Housing Wire
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Real Estate News Updates Week Ending 12/18/2010:
Treasury Selloff ~ 10 Year Yield Jumps ~ Futures Imply 2012 Rate Hike | CNBC
Survey: CEO’s Expect To Hire More As Sales Grow | NPR
Wall Street Finds Lucrative Market In Tax Liens | NPR
Housing Starts Edge Higher In November | CNNMoney
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For most individual home buyers, there are only a few factors that really matter:
Can I afford this home?
Is it a good investment?
Does it meet my family’s needs?
So it’s a bit surprising that the most important housing statistic has gone largely unreported: homes have never been more affordable. Affordability, measured by the median mortgage payment on the current median-priced home ($171,000) as a percentage of the median household income ($62,141), is lower than it’s been in a generation. The chart below shows affordability at a record level, having significantly improved since the height of the recent housing boom in 2006.
Sources: National Association of Realtors, Keller Williams Realty 7 Reasons Why Now Is a Great Time to Buy a Home!
