Managers who want to keep their jobs as house prices fall
The stock market is down about 30 per cent in 2017, but it’s not the end of the world.
That’s because there’s more money on the horizon.
The US Federal Reserve and the Bank of England are likely to raise interest rates, and if you’re on a fixed income you’re likely to be paying a little more for your home.
And some of those increases will be spread across the US economy.
But for those of us who don’t live in a big metropolitan area, the future may be bleak.
According to data from the US Bureau of Labor Statistics, the average annual cost of owning a home in the US has fallen by a whopping 10 per cent over the past decade.
And while some homeowners are finding it tough to keep up with inflation, the percentage of people who have a mortgage that’s still worth more than they borrowed to buy a home has dropped from 25 per cent to 20 per cent.
“The stock market was a little better in 2017,” said Matt Fink, managing director at the firm S&P Global Ratings.
“There’s a lot of upside to it.”
But if the markets go up in the future, it will be for the wrong reasons.
“If the stock market goes up, the value of your home will be going down,” said Fink.
“That’s why people will be renting out their houses, which means they’re paying a lot more for their home.”
You’ll have to pay for more of the utilities.
You’ll have more debt.
There’s just so much pressure to pay rent and utilities, and then you’re dealing with the fact that you’re going to be living with your parents for the rest of your life.””
A lot of people don’t have a place to live, and they’re living with roommates,” said S&s global mortgage strategist John O’Connor.
“There’s just so much pressure to pay rent and utilities, and then you’re dealing with the fact that you’re going to be living with your parents for the rest of your life.”
It could get worseA number of economists believe that the housing market could be in for a severe correction.
“If this downturn persists and housing prices continue to decline, then the economy will likely be in a recession,” wrote the International Monetary Fund’s head of economic research, Martin Winterkorn, in a recent report.
“I expect a very sharp and sharp contraction in the global economy.”
“The US economy could be headed for a deep recession in the first quarter of 2018,” said economist Jeffrey Gundlach.
Ahead of the Federal Reserve meeting in Washington, Fed President Jerome Powell said the central bank would likely increase interest rates “as soon as possible”.
But the US is far from the only country that’s been hit hard by the economic slowdown.
In Canada, a study by University of Calgary economist Paul De Souza found that household debt has ballooned by about $50,000 since 2010.
And in Britain, the National Audit Office has said that the Government is on track to lose up to $15bn in the next two years.
Despite the economic downturn, economists agree that the global housing market is not a bubble.
In fact, there is evidence to suggest that the stock of home loans is on the rise, and that there is a growing sense that the US could be experiencing a “housing bubble”.
But that does not mean that people will have a problem with paying off their mortgage in the near future.
In fact it’s unlikely to get any worse than it is now.
“It will be less expensive, there’s less equity on the market, the housing markets will continue to expand, there will be more demand,” said Mr O’Connors.
“So in that sense, the stock is going to continue to rise.”
The outlook for the stock marketsIn the US, it could be a year or two before people are willing to pay off their mortgages.
It’s worth noting that most mortgage rates are set by the Federal Housing Finance Agency, which sets the maximum loan amounts for many mortgages.
But Mr O”Connor said there are a number of reasons why the mortgage rates could be higher.
First, there are more Americans paying their mortgage.
If you’re an individual who lives in the middle-income bracket, and has a mortgage of less than $1,500 a month, the chances are you’re probably saving a significant amount of money.
Secondly, people have more options.
Many people with home equity loans are able to take out a second mortgage on their homes.
For instance, in New York City, homebuyers can get a mortgage loan with an annual interest rate of about 9 per cent, while buyers can buy a house with an interest rate between 4 per cent and 6 per cent (the higher the rate, the more expensive the house).
And thirdly, mortgage rates can be set to reflect inflation.
The US has been in a housing bubble since the 1970s, but Mr O