"The last few months have brought a spate of favorable news on the U.S. housing market with construction up, more home sales, and home-value growth turning positive. This has been a big change from a year ago, when some analysts worried that the looming 'shadow inventory' would keep the housing sector mired in an economic depression," said Frank Nothaft, chief economist at Freddie Mac.
"Instead, the housing market is healing, is contributing positively to GDP
and is returning to its traditional role of supporting the economic recovery,"
In my opinion, there is truth in what he says, a healthy real estate industry, in and of itself, is a major job creator. As more and more people start to buy homes and the demand for home improvementsÂ soarÂ all service related industries tied into the housing sector grow as well. This creates demand for more workers in those related servicesÂ to keep up with demand.
Remember mortgage rates fell to a 65 year low in 2012. That's because the Federal Reserve started its third round of quantitative easing (QE3) in September. I've read in different articles that the Federal Reserve plans on continuing this effort of easing in order to keep the interest rates low.
The time to buy a home is right now, not tomorrow or next week, or maybe in a few months. Buyers have the perfect opportunity to borrow money right now at very low interest rates. You can borrow $300,000 today for thirty years at 3.5% and the principal and interest monthly payment would only be $1,347.13 per month or you can wait to borrow that money when interest rates are back to 6.5% and that same $300,000 loan will now cost you $1,896.20 or $549.07 per month. That's $197,665.20 overÂ the thirty year period. As Charlie Brown would say, "GOOD GRIEF".
Please remember this, you'll never see the top or the bottom of the market, they both come and go in a blink of an eye. Happy House Hunting!