Housing Industry: Is Housing the Main Indicator into the State of the Economy in 2019?

The US economy appears to be doing well and more than solid, with Q4 of 2018 bringing some relief to the market, however, when it comes to the housing industry metrics don’t seem to add up.

By the time the first quarter of 2019 started off, mortgage interest limits and tax deduction of property didn’t make a negative impact on the industry, and in the meanwhile, the rising mortgage rates alongside the prices of real estate are placing constraint on the market.

Buying a home and investing in real estate is naturally a big step, so investors and buyers are also hesitating cautious due to several factors which includes the case of government shutdown, the volatility in the market alongside the trade tension on the level of global economy.

Affordability Could Save the Housing Market

While some analysts are referring that the housing industry could be the main indicator int the economy in 2019 given the fact that this sector might be one of the rare sectors in the market that had started to show red flags, implying that the industry is a bubble waiting to burst.

This prediction is followed by many reports from analysts stating that the changes in the housing industry might be a form of an introduction into what the economy will become in the course of 2019, predicting a mild to medium inflation, similar to the notorious case of 2008.

On the other hand, in case the mortgage rates would take a sideways turn during 2019, which is more likely to happen according to the chief economist at Fannie Mae, Doug G. Duncan, the housing market might become more tempting and more affordable.

The increased affordability may bring some relief in form of a boost for the housing sector, although the tensions remain in the first quarter of 2019.

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