The US housing affordability crisis continues to worsen as mortgage rates skyrocket to two-decade highs while the cost of an average home is still at bubbly levels. Financing costs are through the roof, and anyone earning less than $100,000 has been priced out of homeownership.
Home prices declined 0.77% from June to July, the first monthly fall in nearly three years, according to Black Knight, a mortgage software, data and analytics firm.
The red hot pandemic-era housing market is cooling as historically tight available inventory shows signs of reversing. An affordability crisis has removed millions of new home buyers as the number of active US listings soared 18.7% in June from a year earlier, the most significant increase in Realtor.com’s data going back to 2017, according to Bloomberg.
Mortgage rates actually fell slightly last week, but the damage has already been done to housing affordability.
US mortgage rates jumped again this week, extending a steep climb that is shutting some would-be homebuyers out of the market.
Since the Fed is rushing to hike the US into a deep recession just so inflation will (supposedly) slide ahead of the November midterms, in line with Biden’s demands, the housing market is eager …
Sales of new U.S. homes fell in March to a four-month low, indicating high prices and surging borrowing costs are putting more of a squeeze on the market.
Analysts expected a 3rd straight month of declines in new home sales in March, but they did not see this bloodbath coming. New Home Sales crashed 8.6% MoM (vs -0.6% exp). That drags new home sales down 12.6% YoY.
In the week ending April 21, 2022, mortgage rates rose for a seventh consecutive week. 30-year fixed rates rose by 11 basis points to 5.11%. 30-year fixed rates jumped by 28 basis points in the week prior.
There’s no doubt about it: Soaring mortgage rates are an economic shock to the U.S. housing market. Over the past month alone, the average 30-year fixed mortgage rate has spiked from 3.11% to 5.11%.