The US Housing Market Slows as Home Sales Plunge to a 13-Year Low
In recent months, home sales in the United States have slowed drastically, with October recording the slowest pace in 13 years. The main cause of this slowdown is the sharp increase in mortgage rates, leaving millions of prospective buyers unable to afford the high cost of homes. This is just one indication that the economy under the Biden administration is facing severe challenges.
According to figures from the National Association of Realtors, sales of previously owned homes, which make up the majority of the US housing market, fell to a seasonally adjusted annual rate of 3.79 million in October. This figure represents a 4.1 percent drop from the previous month and a drastic 14.6 percent drop from the same period a year ago. These figures are significantly worse than what economists had forecast, adding to the growing concern about the state of the housing market.
Lawrence Yun, the chief economist of the National Association of Realtors, has expressed his concern about the situation, explaining that buyers have faced difficulties due to the lack of housing inventory and the soaring mortgage rates. He noted that the highest mortgage rates in a generation have discouraged both buyers and sellers from participating in the market. Despite this, he also pointed out that multiple offers are still occurring, particularly in the starter and mid-priced home segments.
The spike in mortgage rates has been a major contributing factor to the current state of the housing market. In October, the standard 30-year fixed mortgage rate rose from 7.3 percent to 7.8 percent. Comparatively, in the same period the previous year, rates were below seven percent, closer to 6.5 percent. This sharp increase in mortgage rates has made home ownership a pipe dream for many Americans who are now unable to afford the higher monthly payments.
The current administration has been facing criticism for the state of the economy, with many pointing to the significant rise in mortgage rates and other economic challenges as a sign of failed policies. Indeed, when Biden took office, the average 30-year fixed mortgage rate was a mere 2.7 percent. However, this figure has now soared to 7.44 percent, which many critics attribute to the economic policies put in place by the Biden administration.
Social media has been abuzz with comments and criticism about the housing market and its impact on the overall economy. On Twitter, user RNC Research commented, “When Biden took office, the average 30-year fixed mortgage rate was 2.7%. Now, it’s 7.44%. That’s Bidenomics!” Another user, Colette Harrington, remarked, “Congratulations Democrats! A new Joe Biden record. Home sales hit 13-year low as housing market enters deep freeze.”
The housing market slowdown has raised concerns about the impact this will have on the broader economy. Historically, the housing market has been seen as a key indicator of the health of the US economy. Thus, the current state of the housing market could be a sign of deeper-seated economic problems.
The impact of the slowdown in the housing market is being felt across various sectors. Contractors, real estate agents, home improvement companies, and other businesses that depend on a strong housing market are feeling the brunt of the slowdown. Many have expressed concerns about the future of their businesses and the impact on their employees.
Amidst the housing market slowdown, the Biden administration has faced criticism over its handling of the economy. While the administration has tried to downplay the impact of rising mortgage rates, many Americans are struggling with the increased cost of living, particularly in the face of stagnant wage growth. The administration has come under fire for its inability to address the economic challenges facing the country, with many questioning the effectiveness of its policies.
The housing market slowdown has further fueled discontent among many Americans. With home ownership now out of reach for many, there is a growing sense of disillusionment with the economy and the government’s handling of it. The current state of the housing market is likely to influence public sentiment and could have far-reaching political implications in the long term.
Overall, the housing market slowdown has painted a grim picture of the US economy under the Biden administration. With home sales at a 13-year low and mortgage rates at the highest levels in decades, the future of the housing market and the broader economy remains uncertain. As the nation grapples with these economic challenges, it remains to be seen what steps the administration will take to address these issues and restore confidence in the economy.