Real Estate Market Showing Support Despite Interest Rate Hikes
The U.S housing market remains strong despite the Federal Reserve’s decision to raise interest rate in March for the third time since December 2015. According to the National Association of Realtors (NAR), the Pending Home Sales Index, a leading indicator of future existing home sales, rose by 5.5 percent in February. The index is 2.6 percent higher compared with a year earlier and is at the highest level since last April. The NAR indicated that the potential for higher interest rates in the near future and the warm weather last month, helped boost the pending home sales in February.
Lawrence Yun, the chief economist of the NAR, stated, “Buyers came back in force last month as a modest, seasonal uptick in listings was enough to fuel an increase in contract signings throughout the country. The stock market’s continued rise and steady hiring in most markets is spurring significant interest in buying, as well as the expectation from some households that delaying their home search may mean paying higher interest rates later this year.”