One reason we have had a great year in the housing market is the continued availability of low interest rates. The chart above shows 30 year fixed interest rates starting in January of 1972. When I entered the real estate industry in 1992 interest rates were in the 8% range. Now it’s hard to believe that interest rates in the 3′s are available. Source Freddie Mac.
On a related note. Below is a chart from the Wall Street Journal showing a comparison of year-to-date appreciation through July in 2005 through the present. Only 2005 had more appreciation than this year. The data is based on the Case-Schiller Index and includes housing information in the 20 largest markets.