How will rising mortgage rates effect home prices in Parkfairfax Alexandria? This will be answered after the brief neighborhood information for Parkfairax.
Originally Posted At: https://www.comehomevirginia.com/homes-for-sale-in-parkfairfax-alexandria-va-22302
The Parkfairax Neighborhood in Alexandria is an extremely popular community.
What does Parkfairfax have to offer you as a homeowner? There are many benefits to those who choose to make it their home. The Parkfairfax neighborhood is comprised of 1,684 townhouse-type condominium apartments in more than 200 buildings, with 132 acres there is plenty of open free space and natural settings to enjoy. There are thirteen different models available in Parkfairfax, ranging from 1 to 4 bedrooms. With the large number of homes to choose from you will find a wide variety of varying models. Its close in location and charming layout make Parkfairfax a highly sought after community.
Parkfairfax was originally constructed during World War II as the influx of war time residents in the area soared. At that time Alexandria had a very suburban feel and quality to it. Even now the Parkfairfax Community possess that quieter suburban feel with old growth trees and considerable open space not found in many areas anymore.
FIND THE VALUE OF YOUR PARKFAIRFAX HOME
Mortgage Rates and Housing Values / Prices
Since the start of the 2018 year mortgage interest rates have increased by more than half a percent. They are projected to increase by an additional half a percent by year’s end. Each 1% change in interest rates alters a monthly mortgage payment by approximately 11%. Because of this increase in rates, some are guessing that home prices will depreciate.
However, some prominent experts in the housing industry doubt that home values will be negatively impacted by the rise in rates.
Mark Fleming, First American’s Chief Economist:
“Understanding the resiliency of the housing market in a rising mortgage rate environment puts the likely rise in mortgage rates into perspective – they are unlikely to materially impact the housing market…
The driving force behind the increase are healthy economic conditions…The healthy economy encourages more homeownership demand and spurs household income growth, which increases consumer house-buying power. Mortgage rates are on the rise because of a stronger economy and our housing market is well positioned to adapt.”
Terry Loebs, Founder of Pulsenomics:
“Constrained home supply, persistent demand, very low unemployment, and steady economic growth have given a jolt to the near-term outlook for U.S. home prices. These conditions are overshadowing concerns that mortgage rate increases expected this year might quash the appetite of prospective home buyers.”
Laurie Goodman, Codirector of the Housing Finance Policy Center at the Urban Institute:
“Higher interest rates are generally positive for home prices, despite decreasing affordability…There were only three periods of prolonged higher rates in 1994, 2000, and the ‘taper tantrum’ in 2013. In each period, home price appreciation was robust.”
Industry reports are also calling for substantial home price appreciation this year. Here are three examples:
The Home Price Expectation Survey says that prices will appreciate by 5.8% this year.
The Freddie Mac Outlook Report is looking for home prices to appreciate by around 7% in 2018.
The CoreLogic HPI Forecast indicates that home prices will increase by 5.2% on a year-over-year basis.
As Freddie Mac reported earlier this year in their Insights Report, “Nowhere to go but up? How increasing mortgage rates could affect housing,”
“As mortgage rates increase, the demand for home purchases will likely remain strong relative to the constrained supply and continue to put upward pressure on home prices.”
This information about "Will Increasing Mortgage Interest Rates Reduce Home Prices?" is brought to you courtesy of
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