There is a close watch on the U.S. and the global economy, the job market, and the concerns of what’s to come in 2020.
The stock market saw a drop while the bond yield fell due to weak economic data and market volatility. This came from the speculation of ongoing trade war talks between the U.S. and China. This resulted in a bonus for mortgage rates which moved to as low as 3.59 percent; the lowest levels in a month. Because of this drop, there was another surge in refinancing with homeowners. There was a 10 percent boost from the previous week — 163% higher than the same week in 2018.
The job market saw a slow gain of 2.7 million job growth in 2018 to 1.9 million in 2019. This is an important factor in terms of the economic health of the country and affects the housing market. Home prices are expected to drop over the next few years but friction between housing affordability and slow wage growth is still present.
Housing inventory is still tight and down 2.5 percent annually. The demand by buyers is still strong. Young buyers and millennials are expected to provide a boost in home sales in the next coming year. Building confidence returns and home builders will have to start construction to match the high demands.
With predictions of a recession still in topic, experts are reassuring buyers that they do not have to fear. Homeowners have over $3.6 billion in equity in their homes and 37 percent are mortgage-free. Only 4.1 percent have negative equity. This is a good sign of the status of the housing market. It continues to have an optimistic outlook and is highly unlikely to have any cause for the recession as it did in the past.
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