Home prices jump by double digits in almost every US subway
Village News Special
Median single-family home prices increased on an annual basis in 99% of all markets analyzed by the National Association of Realtors during the second quarter of 2021, with 94% of markets seeing double-digit price growth.
The median price of existing single-family homes increased 22.9% year over year in the second quarter to $ 357,900, an increase of $ 66,800 from the previous year. Price growth was double-digit in all regions, led by the Northeast at 21.8%.
“The rise in house prices and the accompanying build-up of real estate wealth have been spectacular over the past year, but are unlikely to be repeated in 2022,” the chief economist said. NAR Lawrence Yun in a statement. “There are signs of an increase in supply in the market and some decrease in demand. The housing market appears to be going from “super hot” to “hot” with much slower price gains. “
Twelve agglomerations analyzed recorded price gains of more than 30%, mainly in the South and West. The top three subways with the highest price increases are Pittsfield, Massachusetts (46.5%); Austin-Round Rock, Texas (45.1%); and Naples-Immokalee-Marco Island, Florida (41.9%).
After a long period of uncertainty, Yun noted that prices have started to rise in the San Francisco and New York metropolitan areas, indicating signs of recovery in those areas.
Over the past three years, home prices have made significant gains in 46 of 182 markets, where homeowners have recorded price gains of over $ 100,000, compared to the typical price increase of $ 89,900 for an existing single-family home observed during that three-year period. The largest gains were seen in San Francisco-Oakland-Hayward, Calif. ($ 315,000); San Jose-Sunnyvale-Santa Clara, California ($ 294,000); and Anaheim-Santa Ana-Irvine, California ($ 279,500).
These rising prices have led to the monthly mortgage payment on an existing single-family home funded by a 30-year fixed rate loan and 20% down payment to be $ 1,215, up $ 196 from to the previous year.
This growth in mortgage payments came even as the 30-year fixed mortgage rate fell to 3.05% from 3.29% the previous year.
“The affordability of housing for first-time buyers is weakening,” Yun said. “Unfortunately, the benefits of historically low interest rates are outweighed by home prices rising too quickly, requiring more income to become a homeowner.
The mortgage payment on a 10% down payment increased to 25% of first-time buyers’ income, down from 21.2% the previous year. A mortgage is generally considered affordable if the payments are no more than 25% of a family’s income.
In 17 metropolitan areas analyzed, a household needed more than $ 100,000 to afford an affordable 10% mortgage, including in a number of subways in California (San José, San Francisco, San Diego, Los Angeles), Hawaii (urban Honolulu area), Colorado (Denver, Boulder), Washington (Seattle) and other states.
In 84 metropolitan areas, one family was able to afford a home on less than $ 50,000, compared to 104 markets where it was achievable in the first quarter of 2021. The most affordable markets included Youngstown-Warren Boardman, Ohio (24,401 $ 10 percent down payment); Peoria, Illinois ($ 24,013); and Cumberland, Maryland ($ 23,773).
“The supply of housing will be key to moderating rising housing costs and rising rents,” Yun said. “Any disincentives to produce more housing, such as extending the moratorium on evictions, will only worsen the current shortage.”
Yun added that NAR has also called for the “quick release” of rental assistance funds to help tenants facing eviction.
Submitted by CR Properties Real Estate Services in Fallbrook.