{"id":2393,"date":"2018-07-12T10:00:20","date_gmt":"2018-07-12T10:00:20","guid":{"rendered":"https:\/\/thezakariagroup.com\/house-buying-power-at-near-historic-levels\/"},"modified":"2018-07-12T10:00:20","modified_gmt":"2018-07-12T10:00:20","slug":"house-buying-power-at-near-historic-levels","status":"publish","type":"post","link":"https:\/\/thezakariagroup.com\/house-buying-power-at-near-historic-levels\/","title":{"rendered":"House-Buying Power at Near-Historic Levels"},"content":{"rendered":"
\n

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

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 Real House Price Index<\/a>,<\/em> First American<\/em> reported that consumer \u201chouse-buying power\u201d is at \u201cnear-historic levels.\u201d<\/span><\/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

    \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>\n<\/blockquote>\n

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

    Here is a graph comparing First American<\/em>\u2019s consumer house-buying power (blue area) to the actual median home price that year from the National Association of Realtors<\/em> (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 Chief Economist<\/em> Mark Fleming explains in the report:<\/p>\n

    \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>\n<\/blockquote>\n<\/div>\n

    Powered by WPeMatico<\/a><\/small><\/p>\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 Real House Price Index, First American reported that consumer \u201chouse-buying power\u201d is at \u201cnear-historic levels.\u201d Their […]<\/p>\n","protected":false},"author":101010,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false}}},"categories":[110,98,99,101,108],"tags":[],"jetpack_publicize_connections":[],"yoast_head":"\nHouse-Buying Power at Near-Historic Levels - The Zakaria Group<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/thezakariagroup.com\/house-buying-power-at-near-historic-levels\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"House-Buying Power at Near-Historic Levels - The Zakaria Group\" \/>\n<meta property=\"og:description\" content=\"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. 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