The U.S. Housing market is the only light in the current state of darkness that the US economy is in. It is the main industry that is thriving despite threats of wide scale budget cuts and their effects to consumers and businesses alike. In addition, the number of houses for sale is currently at the lowest since recession times. This has sparked an increase in buying activity resulting to then consecutive months of price increases. Basically, this is the law of demand and supply at work.
The volume of activity in the housing industry is noted to be at the highest since December of 2007. Builders have already started to break ground for the most number of housing projects in four years. And because the demand is really high and housing market is relaxing lead healthiest sector in the U.S. economy, it is expected that the interest rates on mortgages would remain to be at their all-time low throughout 2013.
2013: Is it the Perfect Time to Invest in Housing?
Bringing together all the factors mentioned above, the housing market is set to take flight this year. In fact, a lot of buyers are jumping into this opportunity by buying or investing in properties. However, experts caution that this bettered health of the housing market does not necessarily indicate that its glorious days have been regained.
Despite the positive signs of housing development, statistics show that about 11 million homeowners are still behind on their mortgage payments and are possibly facing foreclosure. Some even have debts that are more than the value of their properties.
In addition, government data has it that there was a very large drop in housing sales as of last month. This goes to show that the improvement is not stable enough to hold true growth for the U.S. economy. Also, the Federal Reserve is already considering when to withdraw their support to the housing market. Economists also believe that interest rates are more likely to climb up near the close of the year.
The Rise of the Housing Market is Real
Despite the warning released by the U.S. governments and some economists, you cannot help but see if the housing market actually booming. For example, in Washington DC, construction teams are busy constructing new units and putting the final electrical wiring to a row of townhouses. And remember, this is one of the hardest hit areas if the recession hit the U.S.
The return of the health of the housing market is a very strong indicator of where the U.S. economy is heading. This is because the housing market is one of the key reasons for the recession in 2008. The housing market, aside from possibly boosting the GDP by billions of dollars, could also provide jobs and thereby adding as if stews to number of employed Americans.
With jobs, American consumers will have the money to spend. They would also be eligible for loans since they will have basic requirement of employment. Even the retail sectors will indirectly benefit from the rise of the housing market.