There has been a plethora of housing data released in recent days with reports of home affordability and the latest building numbers leading the way. With so many distinct situations depending on where you live and when you purchased your home, it’s difficult to accurately gauge the health of the overall housing market. However, you can use the knowledge as a general guide as you analyze your specific housing situation.
Housing Starts Increasing
Housing starts increased at a higher rate than predicted in January. Experts point to the extension and expansion of the homebuyer tax credit as part of the reason for the higher than expected boost. Going forward, the stimulus should continue to lift sales higher. However, foreclosures continue to increase as well, so it will be a back and forth battle as the housing market struggles to stabilize.
Housing Affordable for Most Americans
According to a report from the National Association of Home Builders and Wells Fargo, home prices are now at near record levels of affordability. According to the data, the typical family making the median income could afford to buy nearly 71% of all homes in the country. That’s a drastic change from the second quarter of 2008 when only 55% of homes sold were affordable. This is a good sign that the housing market is priced more appropriately and prospective buyers now have much less downside risk.
Many Homeowners Owe More than Home Value
Despite the improving housing data, which favors house hunters, current homeowners are in a much less desirable situation. According to another housing report, more than one fifth of homeowners now owe more on their homes than they are worth. Further, the number of foreclosures climbed to record highs.
Sifting through all this housing data takes time and people should be aware that specific situations will vary greatly depending on the region of the country. Additionally, whether you are a current homeowner or are considering purchasing a home soon will determine whether the news regarding the housing market is good or bad. Regardless of your situation, however, it’s clear that the market is trending toward equilibrium, which is goods news for everyone.