President Donald Trump has said since the election that spending on infrastructure and cutting taxes would be one of his first priorities. During his term as the president, the shorter term prospects for the market for housing will be good. After the election, the interest rate on mortgage increased which climbed to above four percentage. It has led to the increased on potential borrowers and borrowers at large. Currently, the housing is less affordable than it was before Donald Trump won the election. The average price of a home is about sixteen thousand four hundred dollars as per post-election interest rate pump making it more expensive for the buyer than it was before the election. You can check here for the effect of President Trump on interest rates:
Affording a home
An individual can provide a home since its affordability is at its lowest point since June 2010. To buy a median home, the people seeking loans must be able to pay sixty dollars including a tax on a monthly basis. For the borrowers putting 3.5 percent down on their homes, the amount charged increases to seventy-two dollars per month.
To purchase a median home which is priced nationwide, 21.6 percentage of the median income is required and is rated low by historical standards. In June 2010, the interest rate were 4.75%, and the price of a home was about twenty percentage lower than they are currently. Home sales from moving forward are inhibited by the interest rate increase.
Potential refinance candidate
Over the last few weeks after the elections, the number of potential refinance candidates reduced by more than fifty percent. The borrowers who were estimated to be around 4.3 million were eliminated from the pool of candidates of potential refinancers. In the process, four million borrowers remained in the total financeable population. Currently, on a monthly basis, one billion dollars is left in potential savings which are less than half the amount that the borrowers could have saved in a month if they refinanced before the election was conducted.
Treasury bond sell-off
Donald Trump being elected the President triggered a Treasury bond selloff which led to a corresponding increase in both ten-year treasury and thirty-year mortgage interest rates. The population of financeable borrowers reduced by more than half as the mortgage rates rose to forty-nine basis points after the election was conducted. The refinance on the share of the market is reduced by the higher interest rates.