- Among recent home buyers, 41 percent had children under 18 in the home. Eighteen percent of buyer households had one child, 16 percent had two children, and 7 percent had three or more children.
- Buyers who had children in the home are more likely than those without children to be purchasing a home because of the desire for a larger home, due to a job-related relocation, or a change in a family situation.
- Buyers who had children in the home had slightly different priorities than buyers without children. The quality of the school district and convenience to parks and recreational facilities were much more important to those with children.
- Buyers with children in the home also place higher importance on a home with a basement, a family room, a kitchen island and an eat-in kitchen.
- For more information on the Profile of Home Buyers and Sellers, click here. And for more info on the Profile of Buyers’ Home Feature Preferences, visit here.
By Lawrence Yun and Ken Fears
- The New York Times reviewed a new research paper by authors from Dartmouth and the University of Warwick in England that implies a rise in the homeownership rate is bad for the economy because fast rising homeownership was associated with much higher unemployment rate. The paper gave examples of several southern states with high unemployment rates as evidence.
- Economic vitality should be assessed not by the unemployment rate but by job growth. A state may have a very low unemployment rate yet have no job growth. What is needed for economic and income growth, in short an improving standard of living, is job growth – the variable this critique focuses on.
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Multiple bidding in a low inventory environment continues to lead to shorter days on the market. About 37 percent of REALTORS® reported that in March recently sold properties were on the market for less than a month when sold compared to 27 percent in the same month last year. The percentage of REALTORS® reporting that the house sold had been on the market for 6 months or more is down to 20 percent from 28 percent a year ago. This information can be found in the March REALTORS® Confidence Index (RCI) Survey report.
At the national level, housing affordability is still very high thanks to lower mortgage rates in spite of higher home prices. What is affordability like in your market?
- In spite of reduced affordability from last month and last year’s near-record levels, the median income U.S. family earns almost double what is needed to purchase the median priced home, so affordability remains high.
- Housing affordability is down for the month of March in the U.S. as rising incomes were not enough to completely offset higher mortgage rates and home prices from February to March.
- From one year ago, affordability is down as lower mortgage rates and higher incomes have not completely offset home price gains.
- By region, affordability is down from one month ago in all regions except the Midwest, where there was no change. From one year ago, affordability is higher in the Northeast and Midwest and lower in the South and West as huge home price gains overwhelmed slightly lower mortgage rates.
- Check out the full data release here.
- The Housing Affordability Index calculation assumes a 20 percent down payment and a 25 percent qualifying ratio (principle and interest payment to income). See further details on the methodology and assumptions behind the calculation here.
FHA’s Permanent MI Policy: Clever, but Still a Problem
When it was announced that the Federal Housing Administration would extend its mandatory monthly mortgage insurance premiums to a minimum of 10 years up to as long as the life of its 30-year loans depending on the size of the down payment, many market observers were incredulous. Others felt that it was a political move to shore up the FHA’s books in the short term only to be reversed in the long term as the financial pressures on the agency abated. However, given long-term prospects for the mortgage market, this change due June 3rd is wiser than first blush, likely to stay and it may benefit some consumers and the market. On the other hand, others will be hurt and more should be done to limit the impact on borrowers who would hold these loans to term.
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