Housing Market Positioned to Bring Back the Economy

Listed by: Jason Mendell
12160 SE Greiner Ln Happy Valley, OR 97086
Listed by Jason Mendell | Offered at $1,700,000 | MLS #19307064

From keepingcurrentmatters.com

Everyone is so focused on the American economy at the moment. As it goes, so does the world economy. With states beginning to reopen, the question becomes: which sectors of the economy will drive its recovery? There seems to be a growing agreement that the housing market is positioned to be that driving force toward the necessary improvement.

Some may question that statement as they look back on the last recession in 2008 when housing was the anchor to the economy – holding it back from sailing forward. But even then, the overall economy did not begin to recover until the real estate market started to regain its strength. This time, the housing market was in great shape when the virus hit.

According to Mark Fleming, Chief Economist of First American, many still live with the effect of the Great Recession. People may be expecting the housing market to follow the same path in response to the coronavirus outbreak. But, distinct differences are showing that the housing market may follow a much different path. The housing market may have led the recession in 2008-2009, it may also manage to bring us out of it this time.

Every piece of sold property has an impressive financial impact on local economies. As the real estate market continues to recover, it will act as a strong tailwind to the overall national economy.

Full article on keepingcurrentmatters.com


As Stay-At-Home Orders Ease, Homebuyers Are Getting Back In The Game

1832 SE Blue Skies Lane Prineville, OR 97754
Listed by The Vandenborn Group | Offered at $669,900 | MLS #220100645

From forbes.com

Homebuyers seem to be taking full advantage now that social distancing orders are being less tight across the country. According to the Mortgage Bankers Association, applications from homebuyers increased last week by 11%, marking the third consecutive week of increases.

The homebuying activity is still down 10% over the year, but that year-over-year gap is thinning out every week. The number of home buying loan applications in April was down 35% annually.

According to Joel Kan, MBA’s Associate Vice President of Economic and Industry forecasting, we can expect the wave of improvement to keep on spreading.

Refinance applications have been declining in recent weeks despite record-low mortgage rates. The average rate on a 30-year, the fixed-rate loan came in at 3.43%, but refinancing activity dropped 3% this week and 2% the week prior. This is probably due to a combination of factors, including stricter lending standards, increasing unemployment, and more time-strapped lenders.

If rates continue to drop, demand for refinances may see an even bigger spike. According to a report from Bloomberg, mortgage rates could drop below 3% in the coming weeks—well below the lowest point on record. This could add serious incentives for homeowners to refinance.

According to the recent Mortgage Monitor report from real estate analytics firm Black Knight, if rates drop to just 3%, more than 19 million homeowners could shave at least 0.75% off their mortgage rate.

This could mean a difference of around $80 per month and nearly $1,000 per year on a $250,000 home.

Full article on forbes.com


U.S. Homeownership Rate Rises to Highest Point in 8 Years

From keepingcurrentmatters.com

Almost everyone has been complying with the stay-at-home orders from our state and local governments for nearly two months now. This unexpected situation has put our daily lives on pause making us find comfort in spending time at home and feel secured from having a much-needed safe place to live.

According to the Housing Vacancy Survey (HVS), Americans place great value in homeownership and it is continuing to grow in the United States. The results provided by the U.S Census Bureau show that the homeownership rate rose to 65.3% for the first quarter of 2020. This is a number that has been rising since 2016 and is the highest rate obtained in eight years.

The National Association of Home Builders (NAHB) explained that a strong owner household formation with around 2.7 million homeowners added in the first quarter has made the increase of the homeownership rate, especially under the decreasing mortgage interest rates and strong new home sales and existing home sales in the first two months before coronavirus hit the economy.

The National Association of Home Builders (NAHB) also highlighted that the homeownership rates among all age groups increased in the first quarter of 2020.

  • Households under 35, who are mostly first-time homebuyers, have registered as the largest gains, with the homeownership rate increased by 1.9% from a year ago.
  • Households with ages between 35-44 have increased by 1.2%.
  • Households with ages between 55-64 have increased by 0.9%.
  • Households with ages between 45-54 have increased by 0.8%.
  • Households with ages over 65 have increased by 0.2%.

Homeownership has always been a great financial investment and an important part of the American Dream. The current situation makes many people feel more thankful for the home they get to share with their families. Coronavirus may be slowing our lives down, but it is showing us the emotional value of homeownership too.

Full article on keepingcurrentmatters.com