A new opinion piece claims that housing may be in for a boom period, following the Fed's new, dovish policy to halt interest rates hikes for 2019, and February's strong existing-home sales data.
For the first time in this cycle, the housing market has three tailwinds to contend with: shifting demographics, labor market strength, and some affordability breathing room, writes Bloomberg columnist Conor Sen. Millennials are entering their prime homebuying years, while recent high employment is setting up an increasing number of buyers with a solid income history for when it comes time to apply for a home loan. As well, there's a chance that mortgage rates could fall below 4 percent in the near future.
There are a couple other reasons the decline in interest rates could lead to a housing-related economic boost. Anyone who bought a house and took out a mortgage when mortgage rates peaked in the fall will become eligible to refinance their mortgage over the next couple months. This could make it advantageous for hundreds of billions of dollars’ worth of mortgages to refinance, meaning new fees for bankers and cost savings for homeowners.
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