There has been an increasing pattern in real estate purchases in the past couple of years. Homes have been selling like hotcakes, so to speak, and lots of have claimed that this real estate boom is far from being over. There are a couple of reasons that have been cited which give some insight into the current real estate market and why real estate sales are not likely to decrease for a long time to come.
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Building Business Not Booming As Much As Real Estate Sales in Oakville
There are lots of reasons why the real estate market slows down. One such reason is due to an over-expansion of homes for sale. Although the home structure business has been rather profitable, it still has a methods to enter order to catch up with real estate sales. This is a good idea because there are not rather sufficient houses to meet the current demand which will keep the market expanding for a long time. So long as the supply does not swallow the demand, the real estate market will continue to prosper.
Interest Rates Stay Affordable
While interest rates have increased somewhat when compared to the past number of years they are still relatively low and make lots of people want to purchase a home. These appealing rates assist keep the real estate market going because a lot of individuals need loans to purchase homes and low-interest rates make the total purchase cheaper. So long as the interest rates remain somewhat steady, potential property buyers will still be revealing fantastic interest in the purchase of a home simply because low-interest rates make the investment more economical.
Length of the ARM Fixed Rate Portion Is Increasing
For those who have variable-rate mortgages (ARMs), they may have worried about the adjustable rate portion when their repaired rate portion was depleted. Recently the fixed-rate portion of the ARM has been increasing with regard to the length of years in which it is active. This has resulted in supporting the real estate market and has also attracted individuals to purchase a home by means of an ARM that has this new lengthier fixed-rate duration.
Turning of Real Estate in OakvilleNot As Common As It Might Seem
Some individuals have been worried that flipping of real estate, which is the purchase and fast sale of the real estate thereafter, is something that may trigger the real estate bubble to burst. However, those who have expressed concern can rest easy understanding that the percentage increase with regard to flipping from 1998 to 2003 is only 1%. When viewing the total scheme of things, a 1% increase within 5 years is not something that must trigger too much concern.
The real estate market has been doing rather well in the past couple of years and the above aspects combine to make what some belief is a real estate bubble that makes sure to burst. Whether this real estate boom continues for a very long time to come is something which stays to be seen. However, the real estate market seems to be remaining constant and while home costs may continue going up supply is not outweighing demand and people keep purchasing. So, only the future will show when the real estate market starts decreasing.