US Home affordability has ‘collapsed’ in 2022

The situation has gotten so bad that it now compares to the “historically low affordability readings” in the fourth quarter of 1987 and the first quarter of 2005, according to the BofA team.

The start of the subprime mortgage crisis as home prices roared higher from 2000 to 2005, and hit a multiyear high in 2006.

https://www.federalreserve.gov/newsevents/speech/bernanke20070517a.htm


The cost of a 30-year fixed mortgage nearly doubled to about 5.25% in May from 2.75% last winter.

MarketWatch 6 June 2022 

https://www.marketwatch.com/story/home-affordability-has-collapsed-in-2022-what-to-expect-next-according-to-bofa-11654555884


US  average for a 30-year loan jumped to 5.78%,

The new average is the highest level since 2008 and is almost double the 2.93% rate on 30-year mortgages last year at this time.

Bloomberg 16 June 2022

https://www.bloomberg.com/news/articles/2022-06-16/us-mortgage-rates-surge-to-5-78-in-biggest-jump-since-1987


The housing market is running hot. Can the Fed cool it before it crashes?

MarketWathch 11 April 2022 

https://www.marketwatch.com/story/the-housing-market-is-running-hot-can-the-fed-cool-it-before-it-crashes-11649507620


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