Advertisement
When should a housing society in Mumbai start considering re...
From GST on JDAs to SEBI’s REIT reclassification and the S...
Stay ahead in the world of real estate with our daily podcas...
Stay ahead in the world of real estate with our daily podcas...
The affordability of housing in the USA has worsened in the last quarter due to a surge in home prices, according to real estate analytics firm ATTOM. Housing costs in 98% of US counties have exceeded their historical average, with the price of a typical single-family home rising by 10% from the first quarter to the second quarter, reaching $350,000. The ratio between average wages and homeownership expenses has also reached its highest level since 2007, indicating a highly unaffordable period in the housing market. ATTOM CEO Rob Barber expresses uncertainty about whether this trend is temporary or indicative of another prolonged surge in prices.
Based on data provided by real estate analytics firm ATTOM, the affordability of housing in the USA has worsened in the last quarter due to a surge in home prices. In their recent report, ATTOM stated that housing costs in 98% of US counties have exceeded their historical average. The price of a typical single-family home rose by 10% from the first quarter to the second quarter, reaching a value of $350,000. This price is also 2% higher than the previous peak recorded last year before rising mortgage rates slowed down the housing market.
Advertisement
Additionally, the ratio between average wages and homeownership expenses has risen to 33% in the second quarter, marking the highest level observed since 2007. This indicates that the US housing market is currently facing one of the most unaffordable periods in decades.
According to ATTOM CEO Rob Barber, the US housing market has experienced a significant turnaround after a period of decline that posed a threat of prolonged stagnation or decreasing prices. As a result, the average worker across the country is now facing further difficulties in affording a home. Barber expressed uncertainty regarding whether this current trend is a temporary fluctuation during the peak buying season or an indication of another prolonged surge in prices.
Although mortgage rates have decreased from their earlier peak of 7%, they still remain relatively high. This has discouraged homeowners from selling their properties, which has prevented the significant price declines that experts predicted for 2022. Consequently, affordability is unlikely to improve until mortgage rates decrease. However, experts believe that such a decline is not expected to occur in the near future.
Currently, the average rate for a 30-year fixed mortgage stands at 6.71%, remaining close to a 20-year high. Experts have suggested that rates should decrease to around 5% in order to stimulate an increase in available housing inventory and improve sales activity. However, according to Redfin's prediction, rates are expected to reach 6% by the end of this year.
5th Jun, 2025
25th May, 2023
11th May, 2023
27th Apr, 2023
Advertisement
Facebook
Whatsapp
