Low mortgage rates boosting Housing?
Getting your own house in the United States will be a distant dream if you belong to a middle class. The latest data points out that home prices increased by 85 percent in US urban areas. The low mortgage rates and better labor costs have triggered massive demand in the housing sector. The single-family home’s median price was 148 last year, but it has increased to 174 in the areas measures, a report by National Association of Realtors pointed out.
Around 51 regions in the country witnessed sharp 10 percent price increase in the real estate sector. The number was on 24 during the fourth quarter last year. The prices have declined in 25 urban areas. The working population in the United States is now recovering from the loss created by the 2008 financial crisis. This has benefited housing markets as contracts to buy homes increased in March. As per the data by the realtors group, the contract number was highest since 2005. The Federal Reserve has already declared a period of full employments, which means anyone who wants to work, has a job.
The unemployment dropped to 5.4 percent as per the latest data. Analyst Stephen East from Missouri-based Evercore ISI informed that due to better job growth, we can see entry level of the housing market is improving. The recovery was not picking up last few years as the entry-level buyers were not eager to buy real estate. The low-interest rates for the housing loans have also encouraged buyers. The mortgage rate for 30 year fixed period was 3.71 in April. During the same month last year, it was 4.36 percent.