Homebuilders Are Ramping Up. How Will That Affect Mortgage Rates?
Research: http://www.thetruthaboutmortgage.com/10-predictions-for-real-estate-and-mortgage-in-2016/
Description: With homebuilders ramping up construction across the country, keeping an eye on mortgage rates has never been so important. Here’s what to expect.
Keywords: Mortgage rates, Construction boom, Home buying, Home mortgage
Will the Building Ramp Up Matter in the Larger Rate Picture?
A jump in mortgage rates has been impending, just around the corner now, going to happen any second, or not likely to happen for a while for a handful of years now, depending on which expert you are listening to. And, while the Fed did finally raise interest rates this year, it hasn’t had
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The long answer is below, but the short answer—from many perspectives—eh, maybe a little, but probably not by much.
The Homebuilding Build Up
For some years now, homebuilders have been increasing production to meet rising demand in many urban markets throughout the United States. That trend continued and expanded even more in 2016. Construction of single-family homes went up by more than twenty-five percent nationwide, with some urban areas reporting increases of more than twice that. By the end of 2016 were likely to see near record construction of new units, in excess of nine hundred thousand. But will all this production be enough to handle the ongoing inventory shortage?
The Ongoing Inventory Shortage
Inventory has continued to be a major problem in most American real estate markets. Homeowners aren’t selling because they cannot find desirable new homes to move into. First time buyers aren’t finding affordable options, because a scarcity of available inventory is pushing prices to record highs in many urban markets throughout the country. So with record building failing to address the ongoing shortage, what is the incentive to raise mortgage