Homes have become less affordable
Home affordability reduced slightly in the third quarter of 2016 according to a report from the National Association of Home Builders and Wells Fargo.
The Housing Opportunity Index shows that 61.4 per cent of homes were affordable on a median household income of $65,700 between July and September this year; in the second quarter the proportion of affordable homes was 62 per cent.
“Regulatory restraints along with shortages of buildable lots and skilled workers are adding to the cost of new homes, which is putting upward pressure on home prices,” said NAHB Chief Economist Robert Dietz.
He added that despite the challenges, now is still a good time to buy with mortgage rates remaining attractive while incomes are increasing.
The most affordable market was Elgin, Ill. with 94.3 per cent of new and existing homes ranked as affordable. San Francisco-Redwood City-South San Francisco, Calif., was the nation’s least affordable major housing market with just 9.7 per cent of homes deemed affordable on a median income.
Mortgage rates nudge higher
There was a slight increase in mortgage rates over the past week with the average 30-year FRM at 3.57 per cent with an average 0.5 point, up from 3.54 per cent a week earlier.
Freddie Mac’s Primary Mortgage Market Survey reveals that 15-year FRMs averaged 2.88 per cent with an average 0.5 point, up from 2.84 per cent a week earlier.
A five-year ARM averaged 2.88 per cent with an average 0.5 point, up from 2.87 per cent a week earlier.
"This week's survey reflects pre-election market conditions,” commented Freddie’s chief economist Sean Becketti. He said it was too early to say how the market would shift over the next week.
Maryland housing market stable in October
Realtors in Maryland report that there was 2.2 per cent rise in activity in October, maintaining the market’s stability. Sales rose to 6,450 in the month.
“While the number of unit sold were almost the same as compared to the October 2015, price appreciation in both average and median prices was notable,” said Maryland Association of Realtors President Shelly Murray.
“While there is a slight decrease of 1.4 per cent in pending units, we are optimistic that there will be strong activity in the remaining months of the year.”
Prices were up 7.5 per cent to an average $317,925 while the median price was up 7.3 per cent to $274,797.