Amazing data here on housing.

    Posted by retirefire on 19th of Jun 2022 at 01:04 pm

    Amazing data here on housing.  With the rise in mortgage rates from 3% up to 6% a stunning 18 million households can no longer qualify for a $400,000 mortgage.

    That’s a 36% reduction in demand.   Housing is in deep trouble.

    50% of the folks are already pissed.

    A lot of interesting angles

    Posted by rjdst on 19th of Jun 2022 at 03:13 pm

    A lot of interesting angles to all of this; too many for a blog post.  But real demand destruction is likely lower as many of those households already have a house and mortgage.   6% is obviously high in recent context, but historically not so much.  It will be interesting to see how the market adjusts.  My realtor was saying folks are starting to downsize expectations - they're still committed to getting a house, but going down in price range to make it work.  Too early to tell if that's a reaction or a trend.

    Best thing to do near-term would be to immediately roll back the previous administration's cap on mortgage interest deductions and state/local tax deductions.  It may be the only opportunity for relief as rates aren't coming down any time soon.  Either way, I won't be voting for JPOW for President; the Fed totally fell asleep at the wheel.  


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