Special offer

Two Charts That Demonstrate The Facts About Home Affordability

By
Real Estate Agent with The Wendy Rawley Team DRE #01898824

The Facts About Home Affordability in 2017

 

There is a great deal of discussion regarding housing affordability for both move-up buyers and first-time buyers, and much of the discussion is delivered with a negative slant. However, the facts are that housing affordability is better today than at almost any time in history.

The naysayers are actually correct in the fact that current housing affordability is not as great as it has been in recent years. But, it is important to keep in mind that home prices truly collapsed during the housing crises that began in 2008. and during that crash distressed properties (foreclosures and short sales), kept housing prices depressed for years.

When we compare current housing affordability to the decades that preceded the crash, a whole different story is revealed.

Here is a recent graph put out by the National Association of Realtors (NAR). The higher the point in the graph, the more affordable houses are.

 

The Facts About Home Affordability in 2017

 

It is plain to see that housing affordability is better today than in the fifteen years prior to the boom and bust.

CoreLogic recently published a report showing Homebuyers "typical Mortgage Payments" nationally.

The Facts About Home Affordability in 2017

The Chart above reveals that while a "typical" housing payment was lower in 2012 (remember the distressed properties that were still a factor back then), it is currently less expensive than it was back in 2000 and is still predicted to continue to be lower next year than it was back in 2000.

In the end, Mark Fleming, Chief Economist at First American puts it this way;

“While borrowing power for the potential home buyer has fallen relative to the low point of 2012, it remains high today and will remain high next year, relative to the long run average. If you don’t want to rent anymore and are considering becoming a homeowner, even if mortgage rates rise next year, your borrowing power will remain strong by historic standards. 

Original Post: OCsearch.com

 

Posted by

 

Wendy Rawley
Realtor ~ CalBRE #01898824
Reliance Real Estate Services
Call/Text (714) 746-6355

Comments (0)