What to expect at HousingWire’s Spring Summit

The focus of the Summit is The Year-Round Purchase Market. Record low rates led to a banner year for mortgage lenders in 2020, and this year is expected to be just as incredible.

Conquering the Mortgage Lender’s Dilemmas

This webinar provides a roadmap for creating a sophisticated, digital-first cost improvement strategy to maximize profits by reducing high processing environments.

HW's 2021 Spring Summit

We’ve gathered four of the top housing economists to speak at our virtual summit, a new event designed for HW+ members that’s focused on The Year-Round Purchase Market.

We need higher mortgage rates to cool the housing market

2020-2024 will have the best housing market demographics and the lowest mortgage rates ever recorded, which could accelerate real home prices too quickly.

Real Estate

Only half of houses for sale are affordable for the average buyer

Housing affordability remains at a 10-year low

Housing affordability continues to hover near a 10-year low, and the National Association of Home Builders is urging policymakers to do something about it.

Of the new and existing homes sold in the fourth quarter of 2018, just 56.6% were affordable for those earning the country’s median income of $71,900, according to the NAHB/Wells Fargo Housing Opportunity Index.

This is up just barely from the previous quarter, as a slight increase in interest rates offset a small decline in home prices, the report stated.

The national median home price was $263,000 in Q4, down from $268,000 in Q3.

But at the same time, the average mortgage rate is increasing, up 17 basis points to 4.89% in Q4 from 4.72% in Q3. This marks the fourth-straight quarter of rate hikes and is the highest level since 2011, the report noted.

NAHB Chairman Randy Noel housing is an early indicator of overall economic health, urging officials to take action.

"Builders are finding it increasingly difficult to build at price points most consumers need because they are struggling with burdensome regulations, higher material costs and shortages of lots and labor," said Noel. "Historically, housing has been the canary in the coal mine, and these ongoing affordability woes should serve as a wake-up call to policymakers to take immediate action."

NAHB Chief Economist Robert Dietz said home price appreciation has outperformed wage growth, and that is stifling housing affordability.

"To keep housing moving forward, policymakers at all levels of government should make it a priority to address affordability concerns that are hurting homebuyers and home builders alike," Dietz said.

The report also highlighted the most and least affordable markets across the country.

Youngstown-Warren-Boardman, Ohio-Pennsylvania, was the most affordable major housing market, with 92.7% of homes sold in Q4 affordable for those earning the area's median income of $60,100.

For the fifth-straight quarter, San Francisco was the nation's least affordable major market, with just 6% of the homes sold in Q4 affordable for those earning the area's median income of $116,400.

Most Popular Articles

Josh Team out as Keller Williams president

Josh Team is out at Keller Williams, not long after he received what appeared to be a promotion. He announced his resignation on Facebook.

Feb 22, 2021 By
3d rendering of a row of luxury townhouses along a street

Log In

Forgot Password?

Don't have an account? Please