Our nation’s mortgage rates have been on the decline for the past year, which undoubtedly has contributed to the rising cost of homes and a busier construction industry. About a month ago, mortgage rates reached an all-time low, with the
30-year fixed rate dipping to 3.4 percent. Was it too soon to celebrate? The rates that were recently at an all-time low have now jumped back up to about 4.1 percent. Some are worried that this housing boom will be crushed before it can really take off.

Others believe that the dip in rates, for the somewhat short period that it was, was enough to spur a lasting economic recovery. According to economists at Goldman Sachs, one of the world’s largest investment banking and securities firm, the housing market is still promising.

According to their studies of home affordability, housing will remain affordable even with a further increase in mortgage rates. The study took into consideration the average U.S. household income, a 20 percent down payment and monthly payments kept at a level equal to a quarter of monthly income. These Goldman Sachs studies indicate that, in addition to there being no real cause for concern, there may even be reason for optimism.

Affordability isn’t the main issue when it comes to the housing market. Some of Americans’ major reservations are job security, ability to save for a down payment and high credit standards. Mortgage rates aren’t the only thing to consider when evaluating the strength of the housing market.

It is also important to note that an increase in mortgage rates isn’t necessarily a bad thing. For example, mortgage rates could be increasing because of consumer confidence, an increase in employment, etc. Right now, home prices are still at an affordable level for most Americans, and that is good news for the U.S. housing market.