Housing Market Potential Increases, But Remains Restricted by Existing Home Supply

By Mark Fleming on June 21, 2023
Our Potential Home Sales Model, which measures what a healthy market for home sales should be based on the economic, demographic and housing market environments, increased modestly in May, but is still down 5.7 percent from a year ago. The primary factor limiting housing market potential is existing homeowners staying put. Read More

Interest Rates Potential Home Sales Tenure

Seasonal Demand Drives Resurgent House Price Growth and Decline in Affordability

By Mark Fleming on May 31, 2023
In March, housing affordability declined, snapping a four-month streak of increasing affordability. The decline in March occurred as two of the three key drivers of the Real House Price Index (RHPI), nominal house prices and mortgage rates, moved higher, decreasing house-buying power by 2.7 percent and dragging affordability down relative to one ... Read More

Interest Rates Real House Price Index Affordability

Outlook for First-Time Home Buyer Affordability is Mixed, but Affordable Markets Remain

By Ksenia Potapov on May 30, 2023
National housing affordability has broadly declined compared with one year ago, especially for potential first-time home buyers. The median renter, who can also be considered the median first-time home buyer, could afford 34 percent of the homes for sale nationally in the first quarter of 2023, down from 45 percent a year earlier. The decline is ... Read More

Homeownership First-Time Home Buyer Outlook Report Renter Affordability

Mind the Gap Between Mortgage Rates and the 10-Year Treasury Yield

By Odeta Kushi on May 24, 2023
The popular 30-year, fixed mortgage rate is loosely benchmarked to the 10-year Treasury bond. Since the end of the Great Recession, the 30-year, fixed mortgage rate has on average remained 1.7 percentage points (170 basis points) higher than the 10-year Treasury bond yield. Yet, this spread is not always consistent. It usually widens during ... Read More

Housing Interest Rates

Two Dynamics Locking Existing Homeowners into their Homes

By Mark Fleming on May 17, 2023
The housing market remains sluggish heading into the spring home-buying season. While mortgage rates have retreated from recent peaks, they remain elevated compared with one year ago. Higher mortgage rates have a dual impact on sales – pricing out buyers who lose purchasing power and keeping some potential sellers rate-locked in. There are plenty ... Read More

Interest Rates Potential Home Sales Tenure

Why Declining House Prices and Softening Labor Market Will Not Trigger a Foreclosure Tsunami

By Mark Fleming on April 21, 2023
Affordability has now improved for four straight months, yet remains down 32 percent since February 2022, according to the Real House Price Index (RHPI). Recently falling mortgage rates have overpowered the affordability-dampening effects of higher nominal house prices. Nominal house price appreciation has slowed dramatically in response to ... Read More

Interest Rates Real House Price Index Affordability