There are a number of factors affecting today’s housing market that could affect buyer activity for years to come. However, staying aware of them could help you get a leg up.
The Counselors of Real Estate, a group of industry experts from around the world, recently met to discuss the long-term issues that could weigh on housing in the next 30 years.
“If you pay attention to them you will be able to beat the market,” said Muldavin Company president and member of the Counselors of Real Estate Scott Muldavin, according to MarketWatch.
The total student debt load topped $1 trillion earlier this year. Now, the average graduate is leaving school with $25,000 in student loans. Past generations did not have to deal as much with this issue as young adults today. Instead, they could start saving money to put toward down payments or other goals.
To cope with this shift, many young people may opt for FHA loans, since they often have smaller down payments and looser credit standards.
Meanwhile, record numbers of graduates are now moving back home after school. This takes away some of the burden of paying off student debt as well as housing. But as a result, the homeownership rate has already declined significantly during recent years. It may slip even further in the coming years.
Baby boomers growing old
As more Americans from the baby boomer generation approach retirement, they will alter the market for home buying and building.
“We’re talking about such a giant wave of elderly people who have different ways of doing things, which will impact how we design facilities,” Muldavin added.
There are an estimated 72 million consumers in the baby boomer generation. As they age, the demand for senior housing could rise. As a result, real estate builders are already starting new projects close to healthcare centers and other popular places.
Global economic questions
The European debt crisis and a slowdown in Chinese economic growth also have both short- and long-term impacts. Some investors are starting to shy away from foreign market for safer options, such as 15-year Treasury bonds. These bonds tie very closely to mortgage rates. Now, this demand has held rates below 4 percent for all but one week so far this year. That trend could continue for quite some time.
When making a mortgage rate comparison, it’s important to have the latest information. Freedom Mortgage updates its mortgage loan rates daily to make sure you find the best mortgage, whether you’re looking to buy a home or just refinance an existing loan.
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