Housing and Economy to Continue Upward Trend

According to a recent article released by the National Association of Home Builders, housing starts will continue the upward trend through much of 2015. A growing economy, competitive mortgage rates, and affordable home prices are the primary drivers of the positive outlook. With that being said, there are still obstacles that leave some level of uncertainty in the market– for instance, tight consumer credit, and rising materials costs could hinder the trend a bit.
Part of the reason why it is believed this upward trend in the industry and in the economy will continue through the remainder of this year and the next, is that the purchase of vehicles and home furnishing is on the rise. This is leading many to believe that consumers now are more likely to buy bigger ticket items such as new homes. Could it possibly be that consumer confidence is back to pre-recession levels? Some believe this is the case.
Due to the increased demand, interest rates are projected to rise. In light of recent increases in credit demand and economic growth, mortgage rates are projected to rise to 5% by the end of 2014 and to 6% by the end of 2015. David Crowe, the Chief Economist of the National Association of Home Builders says this would “not be a significant deterrent to expansion in the housing market.”
We will see what the future holds...
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