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☆ Homebuyers need to earn 80% more than in 2020 to afford a house in this market. It's not just due to high mortgage rates
▼ + stars: | 2024-03-12 | by ( Ana Teresa Solá | ) www.cnbc.com time to read: +1 min

Factors beyond high mortgage rates are affecting housing affordability for many Americans, according to experts. Almost four years ago, a household earning $59,000 annually could afford a new mortgage without spending more than 30% of their monthly income and with a 10% down payment, according to a recent report by Zillow Group. While the typical household in 2024 makes about $81,000 a year, up from $66,000 in 2020, wages have not kept up with housing costs. "Since January of 2020, the typical mortgage payment on the typical home in the U.S. has nearly doubled," said Orphe Divounguy, a senior economist at Zillow. Nowadays, potential homebuyers need to make about $106,500 a year in order to afford the typical home today, an 80% increase from January 2020, according to Zillow.

Persons: Orphe Divounguy, Kirabo Jackson, Jackson Organizations: Zillow Group, Finance, White House Council, Economic Advisers Locations: U.S, Zillow

☆ Why it’s so hard to find an apartment you can afford
▼ + stars: | 2024-02-19 | by ( Anna Bahney | ) edition.cnn.com time to read: +7 min

Washington, DC CNN —Finding a new apartment to rent can be a slog. In New York City, the rental vacancy rate, which is the share of habitable unoccupied units, has dropped to a record low 1.4%. In Boston, the rental vacancy rate was a very tight 2.6% at the end of last year, according to the Census Bureau. However, the most recent vacancy rate is also lower than the more typical 3.6% from prior to the pandemic. In the fourth quarter of 2023, the rental vacancy rate was 6.6%.

Persons: Maria Torres, ”, Orphe Divounguy, “, that’s, Lawrence Yun, Yun Organizations: DC CNN, New York City Department of Housing Preservation, Development, Census, New York City, Springer, Real Estate Investment Services, Joint Center for Housing Studies of Harvard University, National Association of Realtors Locations: Washington, Northeastern, New York, Boston, New York City, Yorker, Manhattan, Northeast, Southern, Austin , Texas

☆ A soft landing is now likely. But Americans will still deal with unaffordable housing
▼ + stars: | 2024-02-04 | by ( Bryan Mena | ) edition.cnn.com time to read: +7 min

In a letter days before the Fed’s decision Wednesday to hold interest rates steady at a 23-year high, Democratic US senators blasted the central bank for America’s housing woes. In 2021 when the Fed’s key interest rate was near zero, home-price growth soared at a historic double-digit pace, according to the S&P CoreLogic Case-Shiller National Home Price Index. Divounguy said that the average 30-year fixed mortgage rate will likely not fall below 6% this year. That way we can actually start heading in the right direction with affordability and have that be sustainable and not just a short-term interest rate phenomenon,” she said. Richmond Fed President Thomas Barkin delivers remarks.

Persons: Valerie Plesch, Orphe Divounguy, Freddie Mac, it’s, Fannie Mae, Divounguy, ” Daryl Fairweather, Trump, Jerome Powell, Donald Trump, Powell, David Goldman, Alexandra Ross, ” Trump, Maria Bartiromo, Joe Biden, Estee Lauder, Tyson, Raphael Bostic, Eli Lilly, Loretta Mester, Walt Disney, Adriana Kugler, Thomas Barkin, Michelle Bowman, Ralph Lauren, Armour Organizations: CNN Business, Bell, DC CNN, Federal Reserve, Democratic, Eccles Federal Reserve, Bloomberg, Getty, CNN, National Association of Realtors, Fox Business, Bureau of Labor Statistics, Trump, Fed, Caterpillar, Tyson Foods, P Global, Institute for Supply Management, Atlanta Fed, Toyota, UBS AG, Chipotle, Cleveland Fed, Walt, CVS, PayPal, Brands, Fox, The Carlyle, News Corporation, New York Times Company, Mattel, Spirit Airlines, US Commerce Department, China’s National Bureau of Statistics, ConocoPhillips, Unilever, Duke Energy, Expedia, Warner Music Group, Tenet Healthcare, Richmond Fed, Pepsico, Honda Locations: Washington, Washington , DC, CAVA

☆ 'Don't blame the Fed' for high mortgage rates, says Zillow chief economist—the real culprit and his predictions for 2024
▼ + stars: | 2024-02-02 | by ( Ryan Ermey | ) www.cnbc.com time to read: +7 min

At a Zillow-sponsored event in October, he said that the Fed's sway on mortgage rates was overstated. Divounguy: Mortgage rates tend to follow the 10-year Treasury yield. We also know that very often there's a spread between mortgage rates and the yield on the 10-year. So a decrease in the Fed policy rate may not cause mortgage rates to decrease that much further. Let's say I have the money for a house, and I expect mortgage rates to come down eventually, if not much this year.

Persons: We've, It's, That's, it's, ’, — Organizations: Federal Reserve, Divounguy, CNBC, Treasury, Fed Locations: U.S

☆ Here are the top 10 hottest housing markets in 2024 — and why you may consider other options
▼ + stars: | 2024-01-23 | by ( Ana Teresa Solá | ) www.cnbc.com time to read: +2 min

Buffalo, New York, made the top of the list, as the area is slated to see increased job growth compared with the number of approved construction permits for new homes. The list is based on an analysis of home value appreciation, how long it takes to sell a home and job growth relative to housing supply. What a 'hot' market means for buyers"Market heat" refers to the level of competition among buyers; when you have more buyers than sellers, you have a hot market, Divounguy said. "They're looking into warmer areas, favorable tax conditions and better housing affordability." Where the housing market is cooling

Persons: Grace Cary, Orphe Divounguy, Divounguy, Jessica Lautz Organizations: Finance, National Association of Realtors Locations: South, Northeast, Midwest, Buffalo , New York, Florida

☆ 'Housing affordability is reshaping migration trends,' economist says. Here's where people are moving
▼ + stars: | 2024-01-23 | by ( Ana Teresa Solá | ) www.cnbc.com time to read: 1 min

Homes in those consumers' new metros cost $7,500 less, on average, compared to the places they left. "Housing affordability has always mattered...and you're seeing it across the country," said Orphe Divounguy, a senior economist at Zillow. "Housing affordability is reshaping migration trends." More from Personal Finance:Gen Z, millennials are 'house hacking'Why can’t today’s young adults leave the nest? Blame high housing costsHow to vet HOAs when house hunting

Persons: Orphe Divounguy, Gen, HOAs Organizations: Van Lines, Finance

☆ Why the housing market is going from tough to terrible
▼ + stars: | 2023-10-20 | by ( Anna Bahney | ) edition.cnn.com time to read: +4 min

The current housing market offers a crushing affordability picture for would-be-homebuyers and is keeping many out of the market. The monthly payment on an average-priced home now requires 40% of the median household income, making housing the least affordable it’s been since 1984, according to ICE. “Longer term Treasury yields — which mortgage rates tend to follow — depend on expected economic growth and inflation expectations,” said Orphe Divounguy, senior economist at Zillow. The median household income was $74,580 in 2022, according to the US Census Bureau. “Good news in the economy causes rates to stay higher for longer — but the longer rates are higher, the more likely something in the market goes ‘boom.’”

Persons: Freddie Mac, ”, Andy Walden, ” Walden, Orphe Divounguy, Nicole Bachaud, Bachaud, John Toohig, Raymond James, ” Toohig, “ Organizations: DC CNN —, ICE Mortgage Technology, Black, ICE, “, Zillow, Census Bureau Locations: Washington

☆ Zillow offers a 1% down payment loan program
▼ + stars: | 2023-08-25 | by ( Anna Bahney | ) edition.cnn.com time to read: +4 min

Zillow Home Loans pays an additional 2%, bringing the total down payment to 3%, which is typically the minimum payment required for a conventional home loan. Currently the program is only available to buyers in Arizona, according to Zillow, with plans to expand. With mortgage rates crossing over 7% in recent weeks and home prices rising, home sales have plummeted over the past year. Offering a low down payment program is in line with Zillow’s return to its core business after a short-lived expansion into the ibuying business. Zillow also offers a down payment assistance tool to see if you are eligible for other programs.

Persons: Zillow, Rich Barton, haven’t, Orphe Divounguy, ” Organizations: DC CNN, Mortgage, Association, US Department of Agriculture, Department of Veterans Affairs, Consumer Financial Locations: Washington, Arizona, homeownership, Phoenix

☆ Zillow rolls out new 1% down payment program in Arizona
▼ + stars: | 2023-08-25 | by ( ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailZillow rolls out new 1% down payment program in ArizonaOrphe Divounguy, Zillow home loans senior economist, joins 'The Exchange' to discuss America's housing affordability crisis, Zillow offering a one percent down payment loan program in Arizona, Zillow's plan to roll out the home loan plan beyond Arizona.

Locations: Arizona

☆ Demand still exceeds supply in the housing market following a rebound in home value, says Zillow
▼ + stars: | 2023-08-21 | by ( ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailDemand still exceeds supply in the housing market following a rebound in home value, says ZillowOrphe Divounguy, Senior Economist at Zillow, discusses the outlook for housing demand and mortgage rates.

Persons: Zillow Orphe Divounguy Organizations: Zillow

☆ Mortgage rates are going up again but home prices aren’t coming down: Why the housing market is out of whack
▼ + stars: | 2023-07-08 | by ( Elisabeth Buchwald | ) edition.cnn.com time to read: +6 min

But after 10 rate hikes, the housing market — traditionally one of the most interest-rate-sensitive areas of the economy — is anything but predictable. Mortgage rates then continued to climb in tandem with the Fed’s hikes until November, when mortgage rates peaked at 7.08%, despite four subsequent rate hikes since then. Higher mortgage rates have reduced home inventoryIn theory, when mortgage rates go up, home prices should fall since it raises the cost of homeownership, thereby reducing demand. That’s partly because the higher mortgage rates that came after the Fed hiked rates created a major lock-in effect, said Kiefer. “That tells the crux of the story for why the housing market seems a bit odd right now,” Divounguy said.

Persons: ”, Orphe Divounguy, Banks, Freddie Mac, Charles Dougherty, Dougherty, “, Len Kiefer, ” Kiefer, Kiefer, Divounguy, Zillow’s Divounguy, ” Divounguy Organizations: New, New York CNN, Federal Reserve, Zillow, Fed, National Association of Realtors, “, CNN, homebuying Locations: New York, That’s, Wells Fargo, Realtor.com

☆ What the banking crisis means for mortgage rates
▼ + stars: | 2023-03-24 | by ( Anna Bahney | ) edition.cnn.com time to read: +6 min

Generally, home buyers can anticipate mortgage rates to move down through the rest of this year as the banking crisis drags on, which could cool down inflation. Neither the actions of the Federal Reserve nor the bank failures directly impact mortgage rates. When Treasury yields go up, so do mortgage rates; when they go down, mortgage rates tend to follow. Following the Fed’s announcement on Wednesday, bond yields — and the mortgage rates that usually follow them — fell. “Homebuyers in 2023 have shown themselves to be quite sensitive to any changes in mortgage rates,” Fratantoni said.

☆ Millennials are now the 'roommate generation' after being squeezed out of homeownership by high housing costs, said Redfin CEO
▼ + stars: | 2023-01-09 | by ( Robert Davis | ) www.businessinsider.com time to read: +4 min

Redfin CEO Glenn Kelman warns that millennials could become the 'roommate generation' due to high housing costs. Millennial homebuyers may find reprieve in the Midwest or quickly-deflating markets like Boise or Salt Lake City. "We have a whole group of Americans who can't afford homes, and that's happening right as Millennials are coming of homebuying age," Kelman said. One reason is that homes in these markets are typically selling for under their list price. Meanwhile, 59% of homes in Chicago are selling for under their asking price as of October 2022 compared to 45.5% of homes selling for under ask across the US.

☆ A 44-year-old who moved from California to Indiana saves $3,210 a month and thinks more people should consider living in the Midwest: 'LA is the glitz and glamour, but when you take that aside, are yo
▼ + stars: | 2023-01-01 | by ( Alcynna Lloyd | ) www.businessinsider.com time to read: +6 min

Vanessa Hughes recently moved to West Lafayette, Indiana, a city of 45,000 and a major university. In West Lafayette, she's paying half the amount for a significantly bigger space with a yard for their two dogs. In 2023, the search for affordable housing could pull more homebuyers towards Midwestern spots like West Lafayette. Michael Hickey/Getty ImagesBy the end of November, they had made the move to West Lafayette. West Lafayette is just one place that offers people incentives to move there.

☆ Homebuyers will flock to the Midwest in 2023 because prices will still be too expensive in coastal states, a Zillow economist predicts
▼ + stars: | 2022-12-06 | by ( Robert Davis | ) www.businessinsider.com time to read: +6 min

The Midwest could be 2023's hottest housing market because it's affordable, one Zillow economist said. Buyers may look at cities like Chicago, Indianapolis, and Cleveland, where prices have remained stable. Homebuyers in expensive markets like Denver, New York City, and San Francisco were routinely searching for homes in less expensive midwestern markets, the report added. The typical home in Milwaukee is $181,000 while in St. Louis, buyers should expect to spend $176,500, Zillow suggests. But waiting out this market may not be the best approach for buyers ready and able to buy now."

☆ Home prices are falling at the fastest rate in 15 years. 7 real estate analysts and economists break down how bad they think it's going to get.
▼ + stars: | 2022-11-30 | by ( Alcynna Lloyd | ) www.businessinsider.com time to read: +8 min

As demand fades in the housing market, price cuts have become widespread. However, despite more sellers cutting asking prices, home prices have still increased by 10.6% year-over-year. On an annual basis, Fannie Mae says house price growth will turn negative beginning in the second-quarter of 2023. According to Freddie Mac's Sam Khater, house price growth will average 6.7% in 2022 and then decline by 0.2% in 2023. With inventory levels at all-time lows, he believes supply and demand dynamics will give way to significant price declines nationwide.

☆ The 9 US cities where buyers have the best shot at scoring a home because home prices have dropped the most since the spring
▼ + stars: | 2022-11-26 | by ( Alcynna Lloyd | ) www.businessinsider.com time to read: +4 min

As homebuyer activity slows, home prices are falling in cities across the country. To get a sense of where home prices are falling the most, we examined home-price data Zillow sent exclusively to Insider. After digging through the numbers for dozens of housing markets, we picked out nine US cities where home prices have rapidly cooled in recent months. So what I expect in those markets is that prices will come down." Read on to see how much prices have fallen in these markets and where else homebuyers are seeing the most discounts.

☆ U.S. weekly jobless claims at 3-month high; equipment spending resilient
▼ + stars: | 2022-11-23 | by ( Lucia Mutikani | ) www.reuters.com time to read: +7 min

"While this could be interpreted as evidence of a softening labor market, we would caution against this. They were boosted by a 5,024 jump in California, likely reflecting the technology sector job cuts. Economists, however, did not expect the technology sector layoffs would be a major drag on the labor market and the overall economy. These so-called core capital goods orders decreased 0.8% in September. Shipments of core capital goods jumped 1.3% after dipping 0.1% in September.

☆ Many Americans are ditching their dreams of owning a house as recession fears flare, says the CEO of one of the nation's largest homebuilders
▼ + stars: | 2022-10-29 | by ( Alcynna Lloyd | ) www.businessinsider.com time to read: +4 min

Not only is this a 23.2% decline from the rate a year ago — it also marks the slowest rate of sales since September 2012. So far in 2022, US housing construction has fallen in four out of nine months. It's a scenario that Orphe Divounguy, a senior economist at Zillow, said will not only impact home builders, but the overall housing market. "What is surprising is that rising rates normally push out potential homebuyers, but they have also pushed out potential sellers," Divounguy told Insider. With less housing inventory being introduced to the market, home prices are likely to remain high.

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