Home Affordability Remains Strong Despite Price Rises
Black Knight Financial Service took a look back on January’s home affordability and foreclosure metrics, and made some interesting discoveries. It would appear that foreclosure starts reached a twelve month high at the start of 2015, both in terms of first time foreclosures and repeats. As of then, repeat foreclosures accounted for better than half of the total foreclosures.
Meanwhile, home affordability, despite two years of rising prices, remains better than what we saw prior to the housing bubble. The low interest rates at the time served well to offset price increases so that the mortgage-to-income ratio average throughout the United States was at 21%. This is an improvement over the 26% average observed from 2000-2002, but it’s still up from the 17.6% low in October of 2012.
Here in Washington state, we are slightly above the average at 21.3%. However, this represents an improvement of 6.5% from 2000-2002, exhibiting a greater-than-average increase of mortgage affordability.
