For The First Time Since 2008, It Costs Over $1000/Month To Purchase A Median U.S. Home
by Tyler Durden
ZeroHedge.com
Feb 6, 2017
Two months ago, with interest rates spiking higher on fears about Trump’s fiscal stimulus, we showed a troubling chart in the October Black Knight Mortgage Monitor report. According to the housing consultancy, as a result of the effect jump in mortgage rates, the population of borrowers who could both likely qualify for and have interest rate incentive to refinance had been cut in half in just one month: “Mortgage rates have jumped 49 BPS in the 3 weeks following the election, cutting the population of refinanceable borrowers from 8.3 million immediately prior to the election to a total of just 4 million, matching a 24-month low set back in July 2015.”
Fast forward to today, when Black Knight released its latest, December, Mortgage Monitor, which reveals another concerning observation, namely that with the recent rise in interest rates, housing is now the least affordable it’s been since 2010
According to the report, at the prevailing 30-year conforming mortgage rate (4.19% as of January 26th), it now requires 22.2% of the median income to make the monthly principal and interest (P&I) payment on the median priced home. Prior to this, the highest post-bubble ratio was 21.4% in 2013, before home prices began to decelerate and interest rates to pull back down.
In total, there was a 10 percent increase in the monthly P&I payment required to purchase the median home in Q4 2016 alone.
The Rest…HERE
