Housing affordability fell in September 2022 compared to August, with the monthly mortgage payment increasing by 8.0% and the median family income increasing by 0.6%.
The 30-year fixed mortgage rate fell to 6.61% from 7.08% the previous week. As a result, owning a home is 5% less expensive than it was a week ago.
Housing starts in October 2022 fell to 1.425 million annualized units, implying we may face shortage conditions. Apartment buildings remain robust, with a 17% gain from a year ago, but single-family starts are 21% below one year ago and well below historical averages.
With changing priorities and preferences, higher home prices, and a rapid increase in remote work, many Americans left central urban areas during the pandemic.
The housing market has shifted from a low-interest rate, low-inventory environment with bidding wars and frenzied activity to a higher interest rate but still low inventory environment.
Job gains continued in October, with 261,000 additional people receiving W-2 statement salaries. There are almost one million more workers now compared to pre-pandemic.
The 30-year fixed mortgage rate fell to 6.95% this week from 7.08% the previous week; it seems that rates have already priced in some of the effects of the Fed's higher interest rates.
Even with the Federal Reserve raising its short-term fed funds rate by another large amount, longer-term interest rates look to move only slightly.
September's pending home sales pace weakened 10.2% last month and fell 31.0% from a year ago.
The 30-year fixed mortgage rate rose to 7.08% from 6.94% the previous week, increasing the monthly mortgage payment by $1,000.
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