This month, the market potential for existing-home sales increased to a 6.1 million seasonally adjusted annualized rate (SAAR), a 0.4 percent month-over-month increase, and a gain of 210,000 (SAAR) sales from January 2017. The gap between actual market performance (existing-home sales) and market potential (potential home sales) has significantly ... Read More ›

As we analyze yesterday’s housing starts data, it’s important to also consider the impact of construction labor on the velocity of new home construction. The employment situation report, released earlier this month, reported an increase of 5,000 residential construction jobs between December 2017 and January 2018. The number of residential ... Read More ›

Whether you plan to buy a modest studio or a four-bedroom penthouse, how much you can afford to borrow primarily rests on two main factors: income and interest rates. Income growth seems to be increasing, thus increasing affordability. However, the near certainty of future rate hikes will likely be a drag on affordability. Read More ›

That nominal house prices are growing faster than household incomes is often used as the basis for arguing that we are facing an affordability crisis. It is true that unadjusted house prices grew faster than income between November 2016 and November 2017. Our Real House Price Index (RHPI) showed that unadjusted house prices increased by 6.0 ... Read More ›

It’s been just over five years since house prices reached their trough and the housing market bottomed out. In the years following that low point, there has been a lot of discussion about how to increase demand and, specifically, why young adults today didn’t want to buy homes. I believed that the lack of desire among millennials was not a ... Read More ›

First American’s proprietary Potential Home Sales model examines December 2017 data and includes analysis from First American Chief Economist Mark Fleming on how the real estate market is performing versus its potential. Read More ›