In my interview with Bloomberg Financial this week with Lisa Abramowicz and Pimm Fox, we discuss the state of the U.S. housing market.
The big question for 2018 so far has been if higher mortgages have impacted demand. Purchase applications are at cycle highs, 1998 levels, even with higher mortgage rates and higher home prices. We have not seen a noticeable negative impact on demand due to these factors like we saw back in 2013/2014. This year, new home sales are at cycle highs with slow and steady growth. I have always stuck to my core premise that we won’t see total housing starts hit 1,500,000 until the years 2020-2024. We won’t see purchase applications data hit the 21st century until years 2020-2024. New home sales won’t get to the 21st century until years 2020-2024. This thesis of slow and steady demand from a deep low-level of sales has stayed true this entire economic cycle even with the longest job expansion ever recorded, over 155,000,000 people working, mortgage rates under 5% since early 2011 and soon to be the longest economic expansion ever recorded in U.S. history.
Three recent articles below on Housing Starts, New Home Sales and Existing Home Sales:
Slow & Steady A Housing Starts Affair
New Home Sales Still Growing, Even With Higher Mortgage Rates
Existing Home Sales Look Perfectly In Line
Logan Mohtashami is a financial writer and blogger covering the U.S. economy with a specialization in the housing market. Logan Mohtashami is a senior loan officer at AMC Lending Group, which has been providing mortgage services for California residents since 1987. Logan also tracks all economic data daily on his own facebook page https://www.facebook.com/Logan.Mohtashami