Tag Archives: housing market

Interest Rates and Idaho’s Housing Market

As an era of low interest mortgage rates appears to be ending and housing prices and interest rates shift steadily higher, many homeowners may find their affordable monthly mortgage payment increasingly difficult to cover.

A prolonged post-recessionary period of low interest rates increased homebuyer purchasing power allowed home prices to rise far beyond levels household income might otherwise allow. The result is a housing market where prices are detached from household income and interest rates – rather than income – are a main driver of economic activity.

Mortgage rates were in a long slow decline prior to the 2007 – 2008 housing market crash which provoked even lower rates. For nearly 10 years afterwards, homebuyers consistently enjoyed mortgage rates well below 5 percent.1

chart of 30-year mortgage rates

Source: Federal Reserve Bank of St. Louis

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Record Low Post-Recession Homes Sales in Eastern Idaho

While it seems the national housing market is moving again, there’s little evidence of that in eastern Idaho.

While the U.S. Census Bureau reports national construction spending rose 9.3 percent in January from a year earlier, marketing statistics from the Snake River Multiple Listing Service show no improvement in the combined housing market of Bonneville, Jefferson, Madison and Fremont counties. Continue reading