Houston Boosts Housing Dollar as Interest Rates Remain Low
More bang for your buck in Houston says one Houston realtor. The city's home sales rocketed upward since the beginning of the year. The Center for real Estate Research at Texas A&M University shows Houston home sales taking off from a little over 4,000 units sold in January to almost 7,500 in June.
"With unemployment and the cost of living low we're seeing an influx of buyers from California, Florida and other areas with a much higher cost of living," says realtor Janet Ladner. "Houston is ranked among the top metropolitan areas in Texas where you get the most house for your money."
The strong influx of buyers has pushed home prices up despite the rising prime interest rate. Average home prices in Houston have jumped more than $25,000 during the first half of 2006.
"Most projections for mortgage interest rates this year anticipate the 30-year fixed rate to stay below 7 percent," says research economist James Gaines. "The Federal Reserve is expected to discontinue its regular increases in short-term rates during the year as inflation fears stabilize, says research economist James Gaines. If these expectations hold, mortgage rates should continue to be attractive to the market."
The prime interest rate has held steady at 8.25% for the past three months. And economists predict a good economy should keep home markets strong. Texas mortgage brokers reported that home purchase, refinance and home equity loan rates all remained steady at this time.
"Expectations for 2006 are for continuation of a fairly robust overall economy with moderate-to-good job growth and sustained business productivity, says Gaines. If interest rates drop further, we may see another favorable bounce for housing prices.