Housing values and sales have certainly been hard hit during most of the recession that we’ve lived through thus far. Though this past year of first-time home buyer’s tax credit offerings has resulted in a much needed boost to the struggling American economy, we may soon be seeing another drop off in home buying due to rising interest rates, the end of the home buyer’s tax credit, and the continuing rise in the numbers of unemployed in America.
As the interest rates offered for mortgages have begun to rise a little, there have been more potential buyers showing hesitancy to purchase homes becoming apparent. The 30-rate for fixed mortgages has risen almost 0.05% since March of this year and combined with rising unemployment, has some potential buyers a little spooked about months to come. Even more distressing for many home buyers, the fixed rate for 15 year mortgages has risen 0.07% in a week.
On top of this there is still no resolution to the attempts to extend the first time home buyers tax credit so that first time buyers can receive the $8,000 credit to help them purchase a home. Many politicians have been working to have this home buying incentive extended for up to nine months so that more home buyers can take advantage of the program and help support the American economy while breaking into the housing market in an affordable way.
These economical elements combined with an ever-increasing unemployment levels just might be a group collaboration working towards stalling the country’s recession recovery. The rate that people are being laid off has, in fact, slowed down but many people are still losing their jobs; as well, in an attempt to hold on to their jobs, many workers have opted to job share or work severely reduced hours which can help them hold on to their job but often means that they’ll be struggling to make ends meet.
It is very likely that we have not yet seen the bottom of the housing value barrel just yet and it is also likely that layoffs have not stopped either so we many Americans will be feeling the financial crunch for some time yet. However much the media keeps telling us that the recession is over, it certainly will be felt for a long time to come by the pocket book of most Americans.
IET Real Estate represents a lot of sellers of Los Angeles short sales. Visit IETrealestate.com to read about Norwalk CA short sales and in other local areas.
