Today’s Chart of the Day is the history of the Housing Affordability Composite Index provided by the National Association of Realtors going all the way back to 1986, with the average line in dotted red.
The index measures whether or not a typical family earns enough income to qualify for a mortgage loan on a typical home based on the most recent price and income data. Earlier this year, due to increased real estate prices, flat incomes, and significantly higher mortgage rates from inflation, the index slipped not even below average, but to the lowest since just before the Great Recession.
A pessimist would say, “Don’t buy,” as this may result in falling values, and an optimist would say, “The worst is over!” as two of the other variables may improve, such as incomes increase, or mortgage rates fall as inflation subsides. As with all things, it will most likely be a combination of all three.
Samuel serves as Senior Vice President, Chief Investment Officer for the Crews family of banks. He manages the individual investment holdings of his clients, including individuals, families, foundations, and institutions throughout the State of Florida. Samuel has been involved in banking since 1996 and has more than 20 years experience working in wealth management.
Investments are not a deposit or other obligation of, or guaranteed by, the bank, are not FDIC insured, not insured by any federal government agency, and are subject to investment risks, including possible loss of principal.
