Housing Market Potential Strengthens Modestly
Summary
One of the four major reasons why housing market potential continues to rise falls with household formation growth, which according to FAFC chief economist Mark Fleming, has been largely driven by millennials. “Household formation continued to grow over the last year, largely driven by millennials, accelerating demand for housing,” said Fleming. “Since the peak of the pandemic in the spring of 2020, lending standards have bounced around but, ultimately, trended toward looser conditions,” said Fleming. “In October, credit loosened compared with one year ago as the economy continued to improve and lender confidence increased. The labor market recovery is expected to continue, putting upward pressure on wages, helping consumer house-buying power.
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