xtreme winter conditions have dampened several industries throughout the country and could be having an impact on housing starts and construction.
Chicago, IL (PRWEB) March 21, 2014
The Federal Savings Bank, a veteran owned lender, knows firsthand that cold winter weather has kept many shut indoors for several months, impacting industries nationwide. Heading into spring, new reports have revealed that the housing market slowdown may be temporary.
Housing starts flounder
According to the U.S. Census Bureau, on March 18th, housing starts were revealed which a February as approximately unchanged nationwide. The report showed that housing starts dropped 0.2 percent in February from the previous month, reaching an annual rate of 907,000 units.
The Federal Savings Bank thinks the results could be an indication that housing market growth has started to slow at the beginning of 2014, though there may be other factors at play. Extreme winter conditions have dampened several industries throughout the country and could be having an impact on housing starts and construction.
The decline in housing starts was not uniform across the country. In fact, some regions including the Midwest and South reported gains, up 34.5 percent and 7.3 percent, respectively. In the Northeast, however, starts were down 37.5 percent in February. At the same time, starts dropped 5.5 percent in the West. By comparison, starts dropped 11.2 percent in January across all regions.
The Federal Savings Bank notes that despite another drop in housing starts nationwide, issuance of new building permits rose 7.7 percent during the month, which could signal that more construction is due to begin as the weather warms.
In addition to fewer housing starts, home prices and sales have seemed to stagnate into 2014. Rising mortgage rates over the last year could have had an impact on homebuyers. Additionally, a low inventory of homes for sale has also kept some Americans from making a new home purchase.
Fortunately, The Federal Savings Bank is happy to report that mortgage rates have remained relatively steady over the first few months of 2014, even as the Federal Reserve has begun to scale back its stimulus spending program, known as quantitative easing. Rates are expected to continue rising, but economists anticipate interest to stabilize around 5 percent for a 30-year fixed-rate home loan. On a historical standard, that rate is still affordable for homebuyers in most housing markets.
Contact the Federal Savings Bank, a veteran owned bank, to find out more about affordable housing options.