Alaska Ranks One of the Most Stable Housing Markets
By: Richard Mantyla
Another busy home building season is upon us. Demand for housing continues to exceed the available supply, often resulting in bidding wars for existing homes. With existing home inventory at an all-time, now is an excellent time to explore new construction. Whether you buy a new or preowned home, your financing options are the same.
Most loan programs offer interest rate locks for 45 to 60 days. If closing will not take place within 60 days, up to one year rate locks are available. Since no one can forecast where interest rates will be in six months, or even one year from now, a longer rate lock can provide peace of mind, while your new home is being built.
With a longer rate lock, a float down option is normally available. If rates decline, you can take advantage of a lower interest rate. Once your interest rate is locked in, you’re protected from possible interest rate increases before you close on your new home.
Many prospective homebuyers currently own a home that they need to sell. Our extremely tight housing market makes it nearly impossible to get a contingent offer accepted on an existing house. Some homebuilders will allow you to sell your current home while your new home is being built. This is a big benefit for buyers who don’t want to own two homes.
Construction Coverage recently published an article naming the most stable U.S. housing markets in 2023. Alaska is one of three states they cited. The results are based on the probability that a buyer purchasing a home between 2000 and present day would have experienced a greater-than-5% price drop following the purchase. According to data, Alaska has a 0% chance of this happening. This is great news for Alaskans!
We expect the Anchorage housing market to remain strong for years to come. Our vast energy resources remain in high demand. Additional development of our North Slope oil fields will create jobs which will grow our economy. World events have amplified the importance of strategic locations, like Alaska, for our military bases. JBER has launched a $390 million construction project to expand its runway to allow for more efficient use of that facility. Ted Stevens Anchorage International Airport continues to expand to meet the needs of the air cargo industry.
With the continued stability of the Alaska housing market, homeownership is still a good choice and one of the best ways to build your net worth.
RICHARD MANTYLA, NMLS #196418, is an experienced and knowledgeable mortgage loan originator (MLO) at Residential Mortgage. He’s worked as an MLO in Anchorage since 1984. He was one of Alaska Housing Finance Corporation’s top closing lenders in 2018, 2019 and 2020.
Residential Mortgage, LLC NMLS #167729
100 Calais Drive, Anchorage, AK 99503