Here's this week's roundup of news and resources, just for you.
Quick takeaways:
New housing starts jumped, helping with a critical supply shortage.
Fed holds rates near zero.
Economists see huge GDP growth coming in the second quarter.
Hispanics and Latinos bought more homes in 2020.
Read on for our coverage.
Much-Needed Construction Surges
New housing construction shot up last month, promising relief to a housing market that desperately needs more inventory. The 1.74 million starts represent a 19% increase over last month and a whopping 37% over this time last year. Economists estimate that the market needs 3.8 million homes to meet surging demand.1
Fed Holds Rates Near Zero
The Federal Reserve decided on Wednesday to hold interest rates at near-zero. The vaccine rollout, it said, has improved the U.S. economy. But with more than 8 million people still out of jobs compared to pre-pandemic levels, the policy-setting Federal Open Market Committee said it will continue to provide accommodation.2
Big Economic Growth Projected
Economists from Fannie Mae expect 6.8% GDP growth in 2021, including more than 9% in the second quarter as the pandemic eases. They also project home sales to be 6.2% higher than last year, and prices to rise 8%. But they continue to watch wild-card factors such as inflation, supply-chain disruption, and how willing consumers are to tap their savings.3
More Latinos Bought Homes During Pandemic
Hispanic and Latino Americans purchased 13% more homes during the pandemic year of 2020 than they did in 2019. The Hispanic homeownership rate peaked in the real estate boom years of the mid-2000s, and then tumbled a little during the financial crisis. Since 2014, it's been on the upswing, reaching between 48% and 49% in 2020. Over the past decade, Hispanic buyers have made up more than 50% of homeownership growth, according to projections from the Urban Institute. They're expected to make up 70% of new homeowners over the next 20 years.4
Have any questions? Reach out to us. We are your home loan experts and are up to date with all the market industry information. kevnik@kevnikmortgage.com
Sources: 1 realtor.com; 2 finance.yahoo.com; 3 fanniemae.com; 4 realtor.com
