What does Brexit mean to Maine
and the Real Estate Market?
It may seem odd that a political decision in the U.K.
could have any impact on American housing prices,
let alone Maine specifically, but that is the nature of
our increasingly intertwined global economy.
The Brexit vote is pushing interest rates to record
lows. Investors in safer U.S. mortgage-backed
securities will be plentiful, which will lower the
interest rates and allow the rates to remain low. The U.S government debt has tumbled, the
yield on the 10-year Treasury falling from 1.75 % to a low of 1.43%.
Currently Maine existing home sales have increased by 25.2 percent in May of 2016 verse
May of 2015. According to the Maine Association of Realtors, the median sale price rose
by 2.8% or $5,250. Mainers’ personal income has also dramatically risen in the first
quarter of 2016. This 1.4 percent increase is the second highest growth in the country.
Combining the low mortgage rates and the increase of Mainers’ personal income will
continue to increase the number of home sales as well as home values. Do not let this
information alarm you; with the strict guidelines and restrictions today’s lenders have to
abide by, it is highly unlikely for a purchaser to buy above their means.
For the people who have been procrastinating all that paperwork for a much-needed
refinance now is the time. Interest rates are at an all time low and not likely to rise,
therefore giving you plenty of time for the process.
The United States may seem more appealing to investors from all over the world for real
estate purchases and start up companies. These wealthy investors have to put their money
somewhere and the low interest rates should guide them to the states.
During all of this Brexit voting Britain officially appointed a new prime minister, Theresa
May who originally was a part of the Remain camp in the run-up to the referendum will
push ahead with UK’s divorce from Europe. The new conservative Prime Minister will
face huge challenges on Brexit and the economy. May has already formed her cabinet and
seems ready to begin discussions on Britain’s trade market.
It seems the Brexit vote combined with the already increase in home sales and Mainers’
personal income could have a very positive effect on our economy and real estate market.
Weather a home purchase or sale, refinance, and investment or start up company the time is
From: By Katie Else of Landing Real Estate