Current Housing Indicators |
| CURRENT | PREVIOUS | ||
| Existing Home Sales | 4.49m | ▼ | 4.74m |
| New Home Sales | 309,000 | ▼ | 344,000 |
| Housing Starts | 583,000 | ▲ | 477,000 |
| Building Permits | 547,000 | ▲ | 531,000 |
| HMI | 9 | UNCH | 9 |
| Existing Home Prices | $170,300 | ▼ (annually) | $199,800 |
| New Home Prices | $201,100 | ▼ (annually) | $232,400 |
More Videos
#DIANAOLICK ON TWITTER
- Robo-Deal Is All About Lowering Mortgage Principal
- As Mortgage Refinancings Surge, Banks Struggle
- Forty States Sign On to Foreclosure ‘Robo’ Settlement
- Running Robo-Settlement Numbers
- Own vs. Rent Riles Government Housing Policy
- Obama's Mortgage Refi Plan to Go Through FHA
- Housing Demand Defies Fundamentals
- US Treasury Forcing Mortgage Principal Forgiveness
- Robo-Reality: Final Foreclosures Fall as Pipeline Swells
- New Financial Crimes Unit Could Throw Wrench in ‘Robo’ Settlement
MOST SHARED
- Users of Citibank Bill-Pay App Charged Twice
- US Trade Deficit Swells to $48.8 Billion on China Gap
- Rep. Bachus Faces Insider Trading Probe: Report
- Euro Sags, Risk Appetite Softens on Greek Deal Holdup
- What's Shaking: Friday's Early Movers
- Israel Likely to Bomb Iran This Year: Political Analyst
- Will Romney Regret Opposing Michigan Auto Bailout?
- FBI Investigated Steve Jobs Drug Use
- Greek Aid Deal ‘Much Better’ Than Euro Exit: Summers
- EU Finance Ministers Won't Get Fooled Again
- Clint Eastwood ‘Surprised’ by Reaction to Chrysler's ‘Halftime in America’ Ad
- Bulls Check In to Community Health
- Bank of America’s Worst-Case Scenario Gets More Real
- Tesla Unveils First SUV: Model X
- New York Fashion Week Hits the Runway as Colors Pop
- Mulling Buffett's Stock Advice? Get in With REITs: Fund Managers
- LinkedIn Earnings Bode Well for Hiring and Social Media
- Top Five Mistakes to Avoid in Online Dating
- Victor Cruz ‘Understands’ Gisele's Super Bowl Frustrations
- Consumer Sentiment Falters, Despite Job Growth
- Obama to Exempt Religious Employers on Birth-Control
- Bonus Bloodbath: Europe Banker Backlash Continues
- US Trade Deficit Swells to $48.8 Billion on China Gap
- SEC Reaches Settlement in Bear Stearns Fraud Case
- Israel Likely to Bomb Iran This Year: Political Analyst
- EU Agrees Rules for $700 Trillion Derivatives Market
- The World's Best Beers
- Rep. Bachus Faces Insider Trading Probe: Report
REALTY CHECK VIDEO
RSS FEED
Realty Check
Text Size 
Yes, You Can Afford A House
I know we’ve been saying over and over that home affordability is soaring to record levels, but a report today from John Burns Real Estate Consulting really puts it into hard numbers, which I thought I’d share.
Let’s start with the big number: the cost of homeownership has fallen 43 percent from the peak in this cycle, with more than half of that due to the decline in home prices and the rest due to lower mortgage rates and increases in income.
Okay, so what does that mean on a real monthly payment basis, because the base sticker price is often less important than the actual amount of the check we’re going to write at the end of every month. How much of your income are you going to spend each month to pay for the house? (Assume that you put 20 percent down on a conforming loan).
In Oakland, CA you will pay 28 percent of your income. That’s down from 84 percent at the peak of the market. I realize, that’s one of the most drastic change scenarios.
But how about here in Washington DC? You are now going to pay 25 percent of your income on your home. That’s down from 53 percent at the end of 2005.
In Nashville you will now pay 22 percent of your income, down from 31 percent in 2007, and in Philadelphia you will now pay 28 percent of your income, down from 36 percent.
Now for my fave: in Los Angeles you will now pay 45 percent of your income on a home. That’s a lot right. Well at the peak of the market, in August 2007, you were paying 102 percent, yup, more than your income, on your home.
So for those of you sitting out there on the fence, waiting for prices to be ever-so-favorable, open your eyes! Prices may fall more, but you’re already in a pretty good place. Historically, a 31 percent debt-to-income ratio on your mortgage was considered fiscally healthy.
Questions? Comments?
Data is a real-time snapshot *Data is delayed at least 15 minutes
