Many are doubtful of the stability of housing market, especially now that there are issues circulating mortgage and financial predicament.
Evidently, if housing market values increase and economic growth is bound on liar loans, bad things are expected to occur. But still, recovery of the mart is noticed.
In the years ahead, there is a projection of uptrend for the housing market as presented by a set of data despite prices to surge in a moment. The National Association of Home Builders/Wells Fargo on Wednesday said that confidence range within the home builders group increase in up to seven months until August. The expansion is attributed to low rates of mortgages and job growth.
Although there is recovery, crash in housing market may be projected in the coming year or two. There is a variety of reasons behind this.
Foreclosures are no longer big deals: The recent data I found, which comes from CoreLogic, states that there is a year-on-year downtrend by 35%. The declining foreclosure account has been recorded from May to June. The phenomenon is not regional, especially now that there is still a follow-up note of double-digit downturn year-on-year in foreclosures.
Growing home values: U.S. housing prices still increase despite small or big movement. One record indicated that FNC residential price index had an increase of less than a percent month over month and year over year by 8% in June.
Closely constrained inventories: Despite slow demand, tight inventories are still reported by National Association of Realtors. A calculated median of just 76 days has been gathered from over 120 US markets in June. The decline is 2.6% month over month and 5% based on year on year data. The nationwide listings, on the other hand, remained at 1% decline year over year.
Acceptable loans: A lower approval rate has been reported by 36% of all US banks with a FICO score of below 680. The recovery is declared sturdy since Dodd-Frank reforms are becoming the bases of banks in being discerning. Besides, the strong lending setting is still composed of higher home values. This only implies that standards for lending have not inhibited recuperation.
Bettering economy: The lowest level of unemployment has been recorded since 2008 partnered with second quarter report of firm recuperation of GDP. Strong business and consumer data have also been registered. In other words, with such mixture of reports, a breakdown is not feasible.
Housing segment of US economy may be in pain and the residents may encounter layoffs once again, the numbers do not always declare the outcome of American financial system.