Home prices fell for the first time in 3 years last month – and it was the biggest decline since 2011
This quickly relays information about recent trends – prices went down for the first time in a while – as well as longer patterns – biggest drop in over a decade.
Next are some figures on housing affordability:
Now, housing affordability is at its lowest level in 30 years. It requires 32.7% of the median household income to purchase the average home using a 20% down payment on a 30-year mortgage, according to Black Knight. That is about 13 percentage points more than it did entering the pandemic and significantly more than both the years before and after the Great Recession. The 25-year average is 23.5%.
The housing affordability statistic is put into terms accessible to a broad audience: nearly 33% of the median household income is needed to buy the average house with common mortgage terms. Additionally, this percentage is higher than recent years and a longer 25 year stretch.
Some housing markets are seeing bigger price declines than others:
Some local markets are seeing even steeper declines over the last few months. San Jose, California, saw the largest, with home prices now down 10% in recent months, followed by Seattle (-7.7%), San Francisco (-7.4%), San Diego (-5.6%), Los Angeles (-4.3%) and Denver (-4.2%).
It could be noted that these are expensive and hot real estate markets. Yes, they had larger drops but they had been pushed higher in recent years than many other markets.
And the article ends with information on mortgage rates:
The average rate on the popular 30-year fixed mortgage began this year right around 3%, according to Mortgage News Daily. It climbed slowly month to month, pulling back slightly in May but then shot more dramatically to just over 6% in June. It is now hovering around 5.75%.
This highlights the rise in mortgage rates this year. Some broader context might be helpful; what was the average rate before COVID-19 or over the last 10 years?
This article provides numerous statistics and often puts the figures in context. Yet, it does lead one lingering question: what is the state of housing prices overall? One answer might be change after a period of trends during COVID-19. Another might be to focus on different actors involved: how does this affect the housing industry or what about the difficulty of some to get into the housing market or it could be a story about higher housing values for many homeowners.
Statistics are not just facts thrown into a void; they require interpretation and are often applied to particular concerns or issues.
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