Mostly Flat Mortgage Rates – According to Len Kiefer, Freddie Mac’s deputy chief economist, borrowing costs haven’t budged much in recent weeks, offering some relief from the weekly rate increases that had almost become routine at the start of 2018. “Mortgage rates have been holding steady over the past two months. Rates could break out and head higher if inflation continues to firm. If inflation continues to trend higher, we may see two or three more rate hikes from the Fed this year, and mortgage rates could follow. For now, mortgage rates are still quite low by historical standards, helping to support homebuyer affordability as the spring home buying season ramps up.”
More Consumers Say It’s a Good Time to Buy – Based on Fannie Mae’s Home Purchase Sentiment Index, home buyers don’t seem to be deterred by rising prices and rates, at least for now. The net share of survey respondents who said now is a good time to buy rose 10 percentage points in March month over month and is now at 32 percent, based on a poll of about 1,000 consumers. Two of the six components registered the largest increases last month: the share of consumers who said it’s a good time to buy and those who were optimistic about selling. The net share of consumers who reported it was a good time to sell a home rose 3 percentage points in March.
Debt-to-Income Ratios Rising Among Buyers – According to CoreLogic, about one in five conventional mortgage loans issued this winter went to borrowers who spent more than 45 percent of their monthly incomes on their mortgage payment and other debts. This is the highest proportion since the housing crisis. Further, that is nearly triple the proportion of such loans issued in 2016 and the first half of 2017. Real estate professionals said that they are concerned a growing number of buyers are becoming priced out of the housing market. Besides rising home prices, the average 30-year fixed-rate mortgage has increased to 4.40 percent, compared to 3.95 percent at the beginning of the year, according to Freddie Mac.
Multigenerational Households Hit New High – Based on a new analysis from the Pew Research Center shows that households with two or more adult generations hit an all-time high in 2016, using the most recent census data available for the analysis. The number of multigenerational households rose to an all-time high of 20 percent or 64 million of the U.S. population in 2016. The multigenerational household trend appears to be growing across nearly all racial and age groups, the Pew Research Center reports. A specific increase in Asian and Hispanic populations does make up a significant part of the boost.