Chicago (PRWEB) March 07, 2014
Several years after the financial crisis, The Federal Savings Bank finds the economy appears to have turned around according a recent NAHB report. The housing bubble burst that left millions of Americans underwater has seemingly come close to a full recovery, recent reports have revealed.
Housing market still improving
The National Association of Home Builders (NAHB) recently released its Leading Market Index on March 6th. The report revealed that more housing markets across the U.S. have returned to normal levels of activity seen before the recession.
"Despite the cold weather that has constrained economic and housing activity across much of the nation this winter, markets are returning to normal levels," said Kevin Kelly, NAHB chairman. "As the job and housing markets continue to mend and the onset of spring releases the pent-up demand for new homes, this will bode well for the remainder of 2014."
According to the report, 59 out of the 350 measured metropolitan housing markets returned to or exceeded pre-recession home prices and sales at the beginning of March. This represents a gain of one market compared to the previous month.
"The number of markets on this month's LMI at or above 90 percent of previous norms has climbed to 130 - a positive trend to watch as the year progresses," said Kurt Pfotenhauer, vice chairman of First American Title Insurance Co., a company that co-sponsors the LMI.
Overall, the Leading Market Index reached a rating of .87, meaning that the national housing market and economic activity were running at 87 percent of their normal level. Over the last year, 84 percent of markets reported improving conditions. At the beginning of March, 32 percent of metropolitan areas had an improved score on the index, indicating that more could follow as the spring selling season approaches. The Federal Savings Bank reminds readers that more homes are sold at higher prices in the spring and summer than other times of the year.
Metro areas that are seeing home prices rise the most are areas that have experienced positive job and wage growth.
"The strong energy sector is at the forefront of the recovery and centered in many small and mid-sized markets in Texas, Louisiana, North Dakota and Wyoming," said David Crowe, NAHB chief economist. "In fact, these four states account for eight of the top 10 markets on the LMI and 45 percent of the markets that are at or above normal."
Mortgage rates settle
While the housing market continues to improve city by city, mortgage rates have recently dropped again, giving homebuyers more opportunity to make a new home purchase. The average interest rate for a 30-year fixed-rate mortgage fell to 4.28 percent during the week ending March 6. The average was 4.37 percent during the previous week. While the decline is welcomed by borrowers, mortgage rates are much higher than they were a year ago, when the average rate was 3.52 percent.
Short-term home loans also experienced a drop in interest rates. The average rate for a 15-year fixed-rate home loan ended the first week of March at 3.32 percent, down from the previous average of 3.39 percent.
Withe the real estate recovering and interest rates recently declining, The Federal Savings Bank encourages Americans to consider now as a good time to apply for a home loan.
Contact the Federal Savings Bank, a veteran owned bank, to explore affordable housing options.