Recent Updates
- **EIA releases, including WPSR, are delayed by the source**
- US: New Residential Sales (May)
- Canada: Payroll Employment, Earnings, & Hours (Apr)
- Italy: Non-EU International Trade (May)
- Mexico: Economic Activity (Apr), Construction (Apr)
- more updates...
Economy in Brief
Italian Consumer Confidence Remains Hammered Down
Italy's consumer confidence fell month-to-month...
U.S. Current Account Deficit Deepens to Record in Q1'22
The U.S. current account deficit deepened to $291.4 billion during Q1'22...
Kansas City Fed Manufacturing Index Declines Further in June But Remains Positive
The Kansas City Fed reported that its manufacturing sector business activity index fell to 12 in June...
U.S. Unemployment Claims Edged Down
Initial claims for unemployment insurance filed in the week ended June 18 declined by 2,000 to 229,000...
U.S. Energy Prices Reverse Earlier Gains
Retail gasoline prices surged to $5.01 per gallon (63.1% y/y)...
Viewpoints
Commentaries are the opinions of the author and do not reflect the views of Haver Analytics.
by Tom Moeller July 9, 2021
• Income eases after falling sharply in April minus government stimulus payouts.
• Mortgage payments rise again with higher home prices.
• Interest rates ease.
The National Association of Realtors' Fixed Rate Mortgage Housing Affordability Index declined 2.6% during May (-15.7% y/y) to 151.7 from 155.8 in April. Affordability has fallen 18.4% since January. A Housing Affordability Index of 100 indicates that a family earning the median income qualifies for an 80% mortgage on a median-priced existing single-family home. This index has been above 100 in each month since July 1990, reaching its all-time high of 213.3 in January 2013.
Affordability was reduced during May as median family income declined 1.0% to $87,689 (+1.2% y/y). In addition, the median sales price for an existing single-family home rose 3.0% (24.4% y/y) to $356,600, the fourth straight month of strong increase. That raised the principal & interest payments to $1,204 (20.0% y/y). Payments as a percent of income rose to 16.5%, the highest level in two years.
Holding back the increase in mortgage payments in May was a decline in the effective mortgage interest rate to 3.01% from 3.11% in April. The rate reached a high of 4.99% late in 2018.
Data on Housing Affordability can be found in Haver's REALTOR database. Median home sale prices also are located in USECON. Higher frequency interest rate data can be found in SURVEYW, WEEKLY, and DAILY.
Housing Affordability | May | Apr | Mar | Y/Y % | 2020 | 2019 | 2018 |
---|---|---|---|---|---|---|---|
Fixed Rate Mortgage Housing Affordability Index (100+=More Affordable) | 151.7 | 155.8 | 175.0 | -15.7 | 172.0 | 161.1 | 147.9 |
Payment as a Percent of Income | 16.5 | 16.0 | 14.3 | 13.9 | 14.5 | 15.5 | 17.0 |
Principal and Interest Payment ($) | 1,204 | 1,184 | 1,138 | 20.0 | 1,028 | 1,044 | 1,079 |
Monthly Mortgage Rate (%) | 3.01 | 3.11 | 3.14 | 3.29 | 3.17 | 4.04 | 4.72 |
Median Family Income ($) | 87,689 | 88,546 | 95,585 | 1.2 | 84,843 | 80,704 | 76,401 |
Median Sales Price (Existing Single-Family Home, $) | 356,600 | 346,200 | 331,500 | 24.4 | 298,708 | 272,333 | 259,458 |