The housing market continues to see increasing prices in many US cities but homes are still relatively affordable
The housing market continues to see increasing prices in many US cities but homes are still relatively affordable.
Black Knight Financial’s September Mortgage Monitor shows that nationally it requires 21.4% of median income to purchase the median-priced home.
That compares to the 24.2% required between 1995-1999 and the 26.2% needed from 2000-2003.
Rising home prices continue to offset the majority of would-be savings from recent interest rate declines, which has kept home affordability near a post-recession low,” said Ben Graboske, Executive Vice President – Data & Analytics, Black Knight. “That being said, when viewing the market through a longer-term lens, affordability across most of the country still remains favorable to long-term benchmarks.”
Graboske acknowledged that conditions are varied across the country but most markets are more affordable than the longer-term benchmarks. Only Hawaii, California, Oregon, and Washington, D.C., have higher payment-to-income ratios today than their longer-term benchmarks.
Black Knight’s data shows that most markets would remain relatively affordable even if prices continue to rise at the 6.2% rate recorded by its price index in August.
There is however potential for affordability to be impacted by a continued rise in interest rates with some states exceeding the longer-term benchmarks by this the fall of 2018.
Black Knight Financial’s September Mortgage Monitor shows that nationally it requires 21.4% of median income to purchase the median-priced home.
That compares to the 24.2% required between 1995-1999 and the 26.2% needed from 2000-2003.
Rising home prices continue to offset the majority of would-be savings from recent interest rate declines, which has kept home affordability near a post-recession low,” said Ben Graboske, Executive Vice President – Data & Analytics, Black Knight. “That being said, when viewing the market through a longer-term lens, affordability across most of the country still remains favorable to long-term benchmarks.”
Graboske acknowledged that conditions are varied across the country but most markets are more affordable than the longer-term benchmarks. Only Hawaii, California, Oregon, and Washington, D.C., have higher payment-to-income ratios today than their longer-term benchmarks.
Black Knight’s data shows that most markets would remain relatively affordable even if prices continue to rise at the 6.2% rate recorded by its price index in August.
There is however potential for affordability to be impacted by a continued rise in interest rates with some states exceeding the longer-term benchmarks by this the fall of 2018.
