{"id":1669,"date":"2018-07-15T06:00:42","date_gmt":"2018-07-15T10:00:42","guid":{"rendered":"http:\/\/buyershomestore.com\/?p=1669"},"modified":"2018-07-14T14:30:09","modified_gmt":"2018-07-14T18:30:09","slug":"house-buying-power-at-near-historic-levels","status":"publish","type":"post","link":"https:\/\/buyershomestore.com\/house-buying-power-at-near-historic-levels\/","title":{"rendered":"House-Buying Power at Near-Historic Levels"},"content":{"rendered":"

We keep hearing that home affordability is approaching crisis levels. While this may be true in a few metros across the country, housing affordability is not a challenge in the clear majority of the country. In their most recent\u00a0Real House Price Index<\/a>,<\/em>\u00a0First American<\/em>\u00a0reported that consumer \u201chouse-buying power\u201d is at \u201cnear-historic levels.\u201d<\/p>\n

Their index is based on three components:<\/p>\n

    \n
  1. Median Household Income<\/li>\n
  2. Mortgage Interest Rates<\/li>\n
  3. Home Prices<\/li>\n<\/ol>\n

    The report explains:<\/p>\n

    \u201cChanging incomes and interest rates either increase or decrease consumer house-buying power or affordability. When incomes rise and\/or mortgage rates fall, consumer house-buying power increases.\u201d<\/em><\/p><\/blockquote>\n

    Combining these three crucial pieces of the home purchasing process,\u00a0First American<\/em>\u00a0created an index delineating the actual home-buying power that consumers have had dating back to 1991.<\/p>\n

    Here is a graph comparing\u00a0First American<\/em>\u2019s consumer house-buying power (blue area) to the actual median home price that year from the\u00a0National Association of Realtors<\/em>\u00a0(yellow line).<\/p>\n

    \"House-Buying<\/a><\/p>\n

    Consumer house-buyer power has been greater than the actual price of a home since 1991. And, the spread is larger over the last decade.<\/p>\n

    Bottom Line<\/strong><\/h3>\n

    Even though home prices are increasing rapidly and are now close to the values last seen a decade ago, the actual affordability of a home is much better now. As\u00a0Chief Economist<\/em>\u00a0Mark Fleming explains in the report:<\/p>\n

    \u201cThough unadjusted house prices have risen to record highs, consumer house-buying power stands at near-historic levels, as well, signaling that real house prices are not even close to their historical peak.\u201d<\/em><\/p><\/blockquote>\n","protected":false},"excerpt":{"rendered":"

    We keep hearing that home affordability is approaching crisis levels. While this may be true in a few metros across the country, housing affordability is not a challenge in the clear majority of the country. In their most recent\u00a0Real House Price Index,\u00a0First American\u00a0reported that consumer \u201chouse-buying power\u201d is at \u201cnear-historic levels.\u201d Their index is based…<\/p>\n","protected":false},"author":4,"featured_media":1670,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_kad_post_transparent":"","_kad_post_title":"","_kad_post_layout":"","_kad_post_sidebar_id":"","_kad_post_content_style":"","_kad_post_vertical_padding":"","_kad_post_feature":"","_kad_post_feature_position":"","_kad_post_header":false,"_kad_post_footer":false,"footnotes":""},"categories":[146,156],"tags":[],"_links":{"self":[{"href":"https:\/\/buyershomestore.com\/wp-json\/wp\/v2\/posts\/1669"}],"collection":[{"href":"https:\/\/buyershomestore.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buyershomestore.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buyershomestore.com\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/buyershomestore.com\/wp-json\/wp\/v2\/comments?post=1669"}],"version-history":[{"count":1,"href":"https:\/\/buyershomestore.com\/wp-json\/wp\/v2\/posts\/1669\/revisions"}],"predecessor-version":[{"id":1671,"href":"https:\/\/buyershomestore.com\/wp-json\/wp\/v2\/posts\/1669\/revisions\/1671"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buyershomestore.com\/wp-json\/wp\/v2\/media\/1670"}],"wp:attachment":[{"href":"https:\/\/buyershomestore.com\/wp-json\/wp\/v2\/media?parent=1669"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buyershomestore.com\/wp-json\/wp\/v2\/categories?post=1669"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buyershomestore.com\/wp-json\/wp\/v2\/tags?post=1669"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}