Thursday, February 20, 2014

RealtyTrac® Finds Monthly House Payments for Home Buyers Increase an Average 21 Percent from a Year Ago in 325 U.S. Counties

 
Daren Blomquist
IRVINE, CA — RealtyTrac® (www.realtytrac.com), the nation’s leading source for comprehensive housing data,  released a housing affordability analysis showing that the estimated monthly house payment for a median-priced three-bedroom home purchased in the fourth quarter of 2013 — including mortgage, insurance, taxes, maintenance, and subtracting the estimated income tax benefit — increased an average of 21 percent from a year ago in the 325 U.S. counties included in the analysis.

The rise in monthly housing payments came as the result of an average 10 percent rise in median prices across the 325 counties combined with a 33 percent increase in the average interest rate for a 30-year fixed rate mortgage as reported by Freddie Mac in its Primary Mortgage Market Survey.

“A potent combination of rapidly rising home prices and the often-overlooked but significant uptick in interest rates in the second half of 2013 caused the monthly cost of owning a home using traditional financing to jump substantially in many markets over the last year,” said Daren Blomquist, vice president at RealtyTrac.

“The monthly cost of owning a home is still less than renting in the majority of markets, but the cost of financed homeownership is becoming dangerously disconnected with still-stagnant median incomes, driven not by shoddy underwriting practices this time around but by investors and other cash buyers who are not tethered to the typical affordability constraints.

Sheldon Detrick
“One simply needs to look at the minimum income needed to qualify for a median-priced home in some markets to realize the extent of the disconnect between prices and incomes,” Blomquist continued.

“For example, in Los Angeles County, the minimum qualifying income needed to purchase a median-priced home is at more than $95,000, up from about $68,000 just a year ago.”

"Home price appreciation continues to climb in the Oklahoma housing market, and in some instances deters people from buying a house, forcing them to rent, especially given the new mortgage rules that took place in the beginning of 2014," said Sheldon Detrick, CEO of Prudential Detrick/Alliance Realty covering the Oklahoma City and Tulsa, Okla., markets.

"The American dream of owning a home still stands though, so potential homeowners will try to buy as soon as they can."

For a complete copy of the company’s news release, please contact:

Jennifer Von Pohlmann
949.502.8300, ext. 139

Brittney Marin
949.502.8300, ext. 107

Data and Report Licensing:
800.462.5193

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