Real house prices jumped 10.5% in September and logged a 60.6% YOY increase, according to First American’s Real House Price Index. As a result, consumer buying power, or how much a person can buy based on changes in income and interest rates, fell by 8.9% month-over-month and 29.3% YOY. The significant dip in affordability measured here results from skyrocketing home prices and rapidly increasing mortgage rates. “Even though household income increased 3.1% since September 2021 and boosted consumer house-buying power, it was not enough to offset the affordability loss from higher mortgage rates and fast-rising nominal prices,” said Mark Fleming, chief economist at First American. Florida, Georgia, Arkansas, South Carolina, and Alabama saw the largest annual increases in real house…
First American Financial’s Real House Price Index increased by 30.6% YOY in February, its fastest growth in the more than 30-year history of the series, the company reported. The RHPI measures the price changes of single-family properties throughout the U.S. adjusted for the impact of income and interest rate changes on consumer house-buying power over time at national, state, and metropolitan area levels. Because the RHPI adjusts for house-buying power, it also serves as a measure of housing affordability. February’s numbers show a rapid month-over-month decline in affordability. Real house prices rose by 5.6% from January, and nearly 31% YOY. Consumer house-buying power fell 3.6% between January and February, and 6.8% YOY. First American attributes the numbers to rising home…
Homebuyers in June 2021 had 129 percent more house-buying power than in 2006, according to the June 2021 First American Real House Price Index (RHPI), released today. “House-buying power, how much one can buy based on changes in income and interest rates, increased by 6.8 percent in June compared with a year ago, propelled by lower mortgage rates and higher household income,” said Mark Fleming, chief economist at First American Financial Corporation, which releases the RHPI. First American is a leading global provider of title insurance, settlement services, and risk solutions for real estate transactions. “The affordability gain from increased house-buying power, however, was offset by the third component of the RHPI, nominal house price appreciation, which reached a record…
