Irvine (California): Owning a home is still a dream for majority of the families in the United States this even as prices have gone down, a latest survey result released Thursday December 21, 2023 showed.
ATTOM, a leading curator of land, property, and real estate data, in its 4th quarter 2023 U.S. Home Affordability Report said that median-priced single-family homes and condos remain less affordable compared to historical averages in 99 percent of counties across the United States with enough data to analyze.
The latest trend continues a pattern dating back to 2021 of home ownership requiring historically large portions of wages around the country.
The report also shows that major expenses on median-priced homes consume 33.7 percent of the average national wage in the fourth quarter – a level considered unaffordable by common lending standards.
Both measures – historical and current affordability – have stayed virtually the same from the third quarter to the fourth quarter of this year after trending consistently against home buyers for almost three years. That has happened as major ownership expenses and wages both are virtually unchanged this quarter.
"But the two measures are still worse than they were a year ago and far weaker than in 2021", ATTOM said in its report.
"For example, the portion of average wages nationwide required for typical mortgage payments, property taxes and insurance are up three percentage points from a year ago and 12 points from early in 2021, right before home-mortgage rates began shooting up from their lowest levels in decades", the curator said.
"The latest expense-to-wage ratio continues to sit above the 28 percent level preferred by mortgage lenders and marks the highest point since 2007", it added.
"The good news is that home affordability has stopped getting tougher around the U.S., at least for the moment. The bad news is that owning a home remains more of a financial stretch than it's been for many years," said Rob Barber, CEO for ATTOM.
"The annual Fall slowdown in the housing market clearly has helped stem the tide working against potential purchasers. Whether that's just a temporary thing tied to seasonal market patterns is something we won't know until next year, especially given recent signs that interest rates are coming down. But for now, there is some break into the growing financial stress for house hunters."
The fourth-quarter trends come at a time of mixed patterns among home prices and home-mortgage interest rates.
While average 30-year fixed mortgage rates around the U.S. have grown this quarter from 7.1 to 7.4 percent, the nationwide median home value has slipped almost 3 percent.
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