MReport December 2021

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48 | M REPORT O R I G I NAT I O N S E R V I C I N G DATA G O V E R N M E N T S E C O N DA R Y M A R K E T THE LATEST DATA Home Prices Rise for Sixth Consecutive Month Rising at an annualized rate of 17.6%, the latest analysis has found that home prices across the nation continued to climb at a record pace in September. R adian's Home Price Index for the month of Septem- ber found that U.S. home prices appreciated at an annualized rate of 17.6% from the prior month, marking the sixth consecutive month of reporting all-time record month-over-month rate increases. "Given the rapid rise in home prices over a relatively short period of time, the Radian HPI is constantly mining the data to find signs of a shift in current housing strength, and so far, it seems to be heading in one direction," said Steve Gaenzler, CFA, SVP of Data and Analytics for Radian. Radian's HPI has risen at an annualized rate of 13.9% over the nine-month period (January 2021-September 2021), nearly 40% higher than the same period in 2020. The Radian HPI is calculat- ed based on the estimated values of more than 70 million unique addresses each month, covering all single-family property types and geographies. Nationally, the median price for single-family and condominium homes rose to $294,488. Radian reports that since the onset of the pandemic in March of 2020, homes across the U.S. have ap- preciated, on average, by more than $41,000. In terms of the nation's housing inventory, in September 2021, the percentage of homes purchased as a percentage of the number of homes listed for sale stood at 34%. "While there are some indica- tions that affordability may be starting to place strain on certain home buyers, the limited supply is a strong support for home price growth." Gaenzler said. "Ultimately, while bidding wars may be reducing in frequency, sellers are still receiving above list price offers in many situations." CoreLogic's latest Home Price Index (HPI) and HPI Forecast for September 2021 found that demand for the short supply of homes listed remained solid through the end of the summer, driving prices upward 18% year over year in September. Millennials led as the segment of buyers with the biggest de- mand, as they continued migrate to tech hubs including Seattle; San Jose, California; and Austin, Texas, while many first-time buy- ers continue to be priced out if the market. And while the growth in tech jobs spurred those areas in terms of interest, Radian found that the South and West regions recorded the strongest annualized one- month appreciation rates for the third consecutive month, at 20.4% and 18.3%, respectively. While the South and West recorded the highest overall appreciation rates, the Midwest reported the largest month-over-month increase in ap- preciation rate at 242 basis points higher than the prior month (16.25% vs. 13.8%). On the other end of the spectrum, the Mid-Atlantic region posted the slowest appreciation rate of all regions at 9.9% year over year and was the only region to report a slower appreciation rate in September 2021, compared to August. Home Prices Find a New High in Q3 According to a report, the median sales price of single-family existing homes climbed 16% from one year ago, but the rate of growth slowed when compared to the prior quarter. N o matter how you look at it, now is a great time to be a home sell- er as the median sale price of an existing single-family home rose again last quarter to another record high. According to the National Association of Realtors (NAR), they attributed the rise to strong homebuyer demand and low housing supply among the top 182 metropolitan areas nationwide. Of the 183 metro areas NAR keeps statistics for, only one area saw a decline in home prices— Shreveport-Bossier City, Louisiana—which saw median home sale prices decrease by a meager 1.5%. All other areas saw prices increase; most areas (78%) saw double digit price increases. "Home prices are continuing to move upward, but the rate at which they ascended slowed in the third quarter," said Lawrence Yun, NAR Chief Economist. "I expect more homes to hit the market as early as next year, and that additional inventory, combined with higher mortgage rates, should markedly reduce the speed of price increases." According to the report, the median sales price of single-family existing homes climbed 16% from one year ago to $363,700, but the rate of growth slowed when com- pared to the prior quarter. The report also found the markets with the highest year- over-year price gains were: Austin-Round Rock, Texas (33.5%); Naples-Immokalee-Marco Island, Florida (32.0%); Boise City-Nampa, Idaho (31.5%); Ocala, Florida (29.7%); Punta Gorda, Florida (27.5%); Salt Lake City, Utah (26.2%); Phoenix-Mesa-Scottsdale, Arizona (25.8%); Sebastian-Vero Beach, Florida (25.7%); Port St. Lucie, Florida (24.9%); and New York- Jersey City-White Plains, New York-New Jersey (24.5%). "While buyer bidding wars less- ened in the third quarter compared to early 2021, consumers still faced stiff competition for homes located in the top 10 markets," Yun said. "Most properties were only on the market for a few days before being listed as under contract." The average monthly mortgage payment on an existing single- family home also rose to $1,214, an increase of $156 from the prior year as the average home has ap- preciated by about $50,300. "Among all homebuyers, the monthly mortgage payment as a share of the median family income increased to 16.6% (14.9% one year ago)," the report said. "For first-time buyers, the typical mortgage pay- ment on a 10% down payment loan increased to 25.2% of the median family income (22.6% one year ago). A mortgage is considered affordable if the payment amounts to no more than 25% of the family's income." "For the third quarter—and for 2021 as a whole—home afford- ability declined for many potential buyers," Yun said. "While the higher prices made it extremely difficult for typical families to afford a home, in some cases the historically-low mortgage rates helped offset the asking price."

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