Mortgage loan rates have fallen again. CNN Money reports that the 30-year mortgage dropped to 3.53% from 3.56% over one week ago, according to Freddie Mac’s weekly report. One year ago, the 30-year fixed rate was 4.52%. The 15-year fixed rate also dropped to 2.83% from 2.86%, compared to 3.66% a year before. Low interest rates are available, but some buyers are finding it challenging to secure them with today’s stricter lending practices. Is there a correlation between tighter lending and recent urban growth in the U.S.?
Census data indicates that population in urban centers outpaced suburbs between July 2010 and July 2011 in 27 of the nation’s 51 biggest cities, according to the Wall Street Journal. This trend is the reverse of the steady suburban expansion seen since the 1920s. Is this a short-term gain for cities? Kenneth Johnson, senior demographer at the Carsey Institute of New Hampshire, believes that households are staying in urban areas either because they can’t secure a loan or choose to wait out the recession. He suspects that as housing and job markets mend, more people will migrate out of the cities and into the suburbs.
Some home builders disagree. Firms that used to focus entirely on suburban, single-family units are diversifying by putting up condominium towers in places like New York City, Northern New Jersey, Philadelphia, and Irvine, Calif. Builders are responding to the demand of those residents who want more lifestyle, less commute. Overall, the line between living in the city or the suburb is becoming blurred, especially as urban centers undergo major quality-of-life improvements — safe and efficient public transit systems, lower crime rates, walkability, and cultural amenities.