The housing starts number was 24.9% higher than that of October and 14.8% higher than analyst estimates for November.
knoxville, TN (PRWEB) December 18, 2013
December 18th was quite a big day the housing/mortgage markets. Peoples Home Equity was very pleased with the positive data released regarding housing starts and building permits. In addition, the Federal Reserve ended its two day meeting by stating that it will begin tapering its third installment program of quantitative easing known as QE3.
According to the U.S. Census Bureau, housing starts soared to a 5 year high today reporting a figure of 1,091k. The housing starts number was 24.9% higher than that of October and 14.8% higher than analyst estimates for November. Peoples Home Equity was surprised and delighted to see such a large amount of new construction taking place since the housing market has been coping with a shortage of inventory. This shortage of inventory is unsustainably propping up the prices of real estate across the country which may sound good in the short term but it’s unhealthy for the housing market in the long term. The lender foreshadows first-time homebuyers leading the next leg of demand for properties. First-time home buyers are going to need financing to assist with their home purchase and with price continuously rising, it’s refreshing to see new inventory being built for the near future to feed demand and calm prices.
Housing starts were not the only big news event for December 18th. The Federal Reserve finally announced it will cut its quantitative easing program by $10 billion from $85 billion a month to just $75 billion a month. While the Fed did not state when it will finally end its successful stimulus program it is aware of “growing underlying strength in the broader economy” as stated in today’s press release from federalreserve.gov.
Peoples Home Equity views this change in policy as the beginning of the end for QE3. As the unemployment rate continues to near 6.5% the amount spent on asset repurchases will decrease, eventually to zero. Once the Fed’s stimulus program ends interest rates, and thus mortgage rates, are expected to increase dramatically. Peoples Home Equity strongly encourages all home owners to apply and get approved for a home now before it’s too expensive!
Please contact Peoples Home Equity loan officer today to discuss all their finance options: (855)-897-0300