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Housing Markets See Interest Rate And Scarce Job Impacts

Thu, 26 Sep 2013 16:52:07 CDT
By: Charlie Schlenker

Demand for affordable housing is soaring according to the head of Habitat for Humanity in McLean County. Habitat Executive Director Jill Roberts says more than 140 families have applied for a habitat house this year and the number has been rising by 20 to 30 applications per year for several years.

She also says the Habitat Re-source store which sells used appliances and other goods for the home has seen a 25% sales increase over the last several months. She says that's another sign that Bloomington Normal residents are stretched thin enough to want to cut every cost they can.

Rising interest rates are starting to hit bankers, even though the effect has not yet been large on the realty market. Tina Marlett (mar-LETT) an Assistant Vice President and Mortgage Lender with Heartland Bank and Trust says loan activity is down seasonally with the start of the school, but part of the decline is also because interest rates have been low for so long.

In the last several years, Marlett says 80% of her business has been refinancing. Marlett says younger potential borrowers are more sensitive to interest rate increases because they have never seen nine to eleven percent rates before. She says the reluctance by younger people to enter the market as rates rise will likely ease over time. Marlett and Roberts spoke to GLT at an Economic Development Council event on the area business climate.     

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