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While an interesting data point and one that deserves more attention, I don't think it's fair to compare the price today to 2006 without taking into account inflation, etc. The median household income in 2006 was roughly $60,000 a year. Today it is $79,000. Granted, these are national median household incomes, but the OP is about national mortgage payments.
I've cited lots of statistics about how millennials and blacks are being priced out of homes. How home prices went up faster than wages coupled with interest rates rising. Large investment firms buying up real estate to turn into rentals.
Are you saying there is no rational basis for thinking there is choppy housing markets ahead?
Do you realize that Bernie Sanders is saying that the housing market is in crisis as I type?
To your point, even adjusted for inflation, etc., many areas are still seeing folks struggle mightily. Wages have increased a lot for many since 2006, but for many they are still pretty low paid.
I've cited lots of statistics about how millennials and blacks are being priced out of homes. How home prices went up faster than wages coupled with interest rates rising. Large investment firms buying up real estate to turn into rentals.
Are you saying there is no rational basis for thinking there is choppy housing markets ahead?
Do you realize that Bernie Sanders is saying that the housing market is in crisis as I type?
well....someone else has started a different thread about corporate rentals. I've put some interesting stuff in there, and won't repost it all here, but "corporate landlords" isn't the nationwide problem some seem to think it is.
And really, the way to blunt the seriousness of it is to get the HOA in a neighborhood to pass restrictions on rentals/ownership. Should it be draconian "owners only!!1!!" of course not. But it could, say "must be owner-occupied for 1 year" or "only X% of units can be rentals" (which is really the best way).
I guess I'll have to look back over the weeks of this thread for the info about millenials being priced out nationwide or Blacks priced out nationwide.
I am surprised that the same people who argue that the 99% are falling behind and that we need more freebies to help with this, are denying the obvious reality of home prices being unaffordable for more and more people.
everything up to this point I had already responded to. Did the magic reddit chart (source) ever get posted?
I am not arguing that whatever % are falling behind need more freebies. In the posts before yours above, I pointed out where mortgages are not UNaffordable, they are LESS affordable.
If an affordability index has 100 as "Okay", you were at 200 "Amazingly affordable!!" a year ago and now you're at 150 (25% lower) ... are you unaffordable? Of course not.
I wanted to post another response so that people could see the actual numbers.
Median home price January 2018 = $240,964.28
Median home price January 2022 = $357,837.38
Assuming the same interest rate, here are the monthly payments for buying the same median home.
January 2018 Median home monthly payment = $1,293.55
January 2022 Median home monthly payment = $1,920.95
That is $627.40 more per month to buy the same home 4 years later.
Do you think $627.40 more per month to buy the same home will price out more families? Mind you, property taxes are up, property taxes are up and not factored in. If you think that the average family can't afford to pay $627.40 more per month to buy the same median home, then you agree with me.
It really depends on the market you live in. My zip code the average is about 975k.
I see a correction coming soon as interest rate hikes will probably end up lowering prices.
Good for buyers I suppose.
let's say the local paper has reported that the median (not average) sales price in your zip is indeed $975K. Is there a current (last 6 months) median income figure for your zip code? Is there a median income figure for those who bought those homes?
Speaking of taxes, did you see the city of Detroit drastically overcharged its citizens on property taxes? In the process many people lost homes due to being overcharged, mostly black people, and the city has the nerve to try and not make it right and they still mismanaged their finances and declared bankruptcy.
Those same people made homeless are having a hard time buying a new home.
Nation wide black people struggle to buy a home at growing rates. It doesn't help when city governments are scamming them.
I'm sorry, but you'll have to provide a link from somewhere that's not a paywall.
I will provide some info and make a prediction, while I wait ...
The homeownership rate tops out at ~66%. We had always nudged up against that, and in the 2000-2006 timeframe tried to overcome that natural human reality. We got the subprime crisis, partly as a result of that.
That 33% of "should rent" includes folks moving across state lines and those under 30 who need mobility for jobs and frankly have not established financial acumen and downpayments to buy.
The average age of a FTHB has knocked around from 30-32 since 1991. For 3 years, it's been 33 years old. (NAR 2021 Survey of Buyers & Sellers).
In 2001, the median downpayment for FTHB was 6%. From 2003-2010, it dropped below 5%, as low as 2% in 2005 and 2006 (whoops - see that subprime crisis). Since 2018, it's been back to 6 or 7%.
Now, Blacks have ALWAYS had the lowest rate of homeownership, peaking at 49% - you guessed it - in 2004. Today, the rate has dropped all the way to 42% (14%), a much larger drop than other races (~5%).
How do the earnings of Blacks compare to the earnings of other races (lower, I'm sure) so they don't QUALIFY as at high of rates as other races. Rising interest rates will further complicate that. How do the savings of Blacks compare to other races (lower I'm sure) so they can't make a downpayment.
Said 48% of renters don't think they'll ever buy, because ...
Quote:
Down payments are the biggest barriers holding back those who want to own a home but don’t currently. 54% of that group say they can’t afford a down payment. Other common barriers include home prices being too high in their area (36%) and difficulty qualifying for a mortgage due to a low credit score (32%).
The same people downplaying this number are the same people who gave elaborate reasons as to why:
2022 would be a great year for stocks
Why we'd see no inflation coming out of the pandemic
Why the inflation being registered would be just a couple months and small
Etc
The mainstream finance media has bubble vision, everything is grand, invest more.
downplaying the number of foreclosures ("this number")?
I believe it's quoted, but ...
Even in '07-'10 - the foreclosure rate topped out at 2.3%
in 2019, foreclosures were almost unheard of. 0.39%
Now, there were about the same rate - with the moratorium - in 2020.
So, even if they TRIPLED to ~1% in 2021, they'd still be half of 2010.
If you want to focus on this issue - paying the mortgage - concentrate on the delinquency rate right now. And guess what - the delinquency rate was down for March.
Until about 4 months ago, nobody was getting ARM's. And ARM's that reset at a higher rate or even balloon and require refinancing - that's a HUGE part of the mortgage meltdown in 2008.
Something has to give at some point. On one hand I like as a home owner seeing the appreciation, but I also understand that it's getting harder and harder for young people to even begin think about buying a home, specially in specific markets like LA and NYC and some others.
Our condo we bought in the late 90s has quadrupled in value over the last several years. If I can sell it and move out of the state to someplace cheaper we could make a killing on it. Again, feel bad for young people just starting out.
I think at some point there has to be some kind of correction.
how many new condo projects at FTHB prices have there been in your county in the last decade? How many new (moved there or GenZ/last Millenials) people/potential FTHB are there now?
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