According to the latest real estate market reports, homes remain more affordable to buy in 94 of the country’s 100 largest metros compared to historic averages. On the other hand, renting is more expensive than ever in 88 of the country’s 100 largest markets.
“The affordability of for-sale homes remains strong, which is encouraging for those buyers that can save for a down payment and capitalize on low mortgage interest rates. But the health of the for-sale market is directly tied to the rental market, where affordability is really suffering” said Zillow Chief Economist Stan Humphries.
This report confirms the concerns of Shaun Donovan, former Secretary of the U.S. Department of Housing and Urban Development, in March.
Since rents didn’t experience the massive drop that home values witnessed during the recession, rent prices just keep climbing. Meanwhile, home values jumped 6.5% year-over-year, while national rents increased 2.8% for the same time span.
And now due to low mortgages rates and housing affordability, homeowners at the end of the second quarter only have to expect to pay 15.3% of their income to a mortgage, significantly below the pre-bubble days of 22.1%.
“As rents keep rising, along with interest rates and home values, saving for a down payment and attaining homeownership becomes that much more difficult for millions of current renters, particularly millennial renters already saddled with uncertain job prospects and enormous student debt,” Humphries said.
“In order to combat this phenomenon, wages need to grow more quickly than they are, particularly for renters, and growth in home values will need to slow,” he continued.
The benefits of homeownership may not outweigh renting forever. Mortgage rates are expected to rise in the coming year.
“When mortgage rates hit 5%, still very low by historical standards, the number of unaffordable metros for homeowners among the top 100 will more than double, to 13,” the report said. When rates hit 6%, the number of unaffordable metros will almost double again, to 24.
County Properties, 26 years of brokerage experience, trust.
We offer free counseling in real estate regarding; home values and information on options of selling vs. Foreclosure.
To get started on viewing homes, condos, investment properties, pre-foreclosures, bank owned foreclosures (REO’s) or thinking of selling your property, please contact me today for free counseling at (619) 540-5811.
New Pro-Property Search. We will setup a customized search for you by our professional REALTOR® Team. Sit back relax and shop at home! We will make changes to your Pro-Property Search any time you like, just let us know. Have fun!
By the way…if you know of someone who would appreciate the level of service in real estate we provide, please call me or have them go to www.CountyProperties.net/ and I’ll be happy to follow up and take great care of them.
For Luxury homes
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This report confirms the concerns of Shaun Donovan, former Secretary of the U.S. Department of Housing and Urban Development, in March.
Since rents didn’t experience the massive drop that home values witnessed during the recession, rent prices just keep climbing. Meanwhile, home values jumped 6.5% year-over-year, while national rents increased 2.8% for the same time span.
And now due to low mortgages rates and housing affordability, homeowners at the end of the second quarter only have to expect to pay 15.3% of their income to a mortgage, significantly below the pre-bubble days of 22.1%.
“As rents keep rising, along with interest rates and home values, saving for a down payment and attaining homeownership becomes that much more difficult for millions of current renters, particularly millennial renters already saddled with uncertain job prospects and enormous student debt,” Humphries said.
“In order to combat this phenomenon, wages need to grow more quickly than they are, particularly for renters, and growth in home values will need to slow,” he continued.
The benefits of homeownership may not outweigh renting forever. Mortgage rates are expected to rise in the coming year.
“When mortgage rates hit 5%, still very low by historical standards, the number of unaffordable metros for homeowners among the top 100 will more than double, to 13,” the report said. When rates hit 6%, the number of unaffordable metros will almost double again, to 24.
County Properties, 26 years of brokerage experience, trust.
We offer free counseling in real estate regarding; home values and information on options of selling vs. Foreclosure.
To get started on viewing homes, condos, investment properties, pre-foreclosures, bank owned foreclosures (REO’s) or thinking of selling your property, please contact me today for free counseling at (619) 540-5811.
New Pro-Property Search. We will setup a customized search for you by our professional REALTOR® Team. Sit back relax and shop at home! We will make changes to your Pro-Property Search any time you like, just let us know. Have fun!
By the way…if you know of someone who would appreciate the level of service in real estate we provide, please call me or have them go to www.CountyProperties.net/ and I’ll be happy to follow up and take great care of them.
For Luxury homes
[iframe http://realestatelistings.1parkplace.com/47042/Sandicor/Search?viewMode=gallery 780 2100]