Housing affordability crisis deepens
Key Questions
How much has the qualifying income for homebuyers increased?
Qualifying income jumped $15,600 in five months due to higher mortgage rates and prices. This has sharply reduced affordability.
What is the current level of builder sentiment?
Builder sentiment remains at 34 and has stayed below 40 for 15 consecutive months. This is the longest stretch since 2012.
How are builders responding to weak demand?
37% of builders are cutting prices and 63% are using incentives. Multifamily starts have surged while single-family construction declines.
When will the new housing law improve affordability?
The new housing law is not expected to provide relief for years. Inventory constraints remain the primary culprit according to Zillow analysts.
What share of wages goes to rent in the current market?
Rents are consuming 37% of wages on average. Pending home sales fell 5.4% in June due to elevated borrowing costs.
Qualifying income jumped $15,600 in five months; builder sentiment stuck at 34 (below 40 for 15 months, longest since 2012); 37% of builders cutting prices, 63% using incentives; new housing law won't provide relief for years. Zillow analyst cites inventory constraints as culprit, rents consuming 37% of wages. Multifamily starts surge but single-family declines.