At some point, we’ve all fantasized about moving somewhere far from home. Whether it was after a particularly good vacation or a bout of bad weather, it isn’t uncommon to think about what it might be like to live in a different place. Truthfully, though, a lot of those fantasies involve moving some place more expensive than where we currently live. So, if you’re dreaming of moving away but would like some more affordable options, you may be interested in a recent analysis of the country’s most affordable states. The analysis based affordability on a number of factors, including median home prices, housing costs, grocery costs, utilities, inflation, and state income taxes. What it found was there are affordable places to live in all regions of the country. In fact, the top ten included North and South Dakota, Tennessee, Alaska, Texas, Florida, Washington, Nevada, and Wyoming. The most affordable state, though, was New Hampshire. That covers every area from the Northwest to the South and should provide some more realistic options next time you’re dreaming of getting away. (source)

It’s natural to look back on decisions you’ve made and wonder what might’ve been had you made different choices. So it’s not surprising that an overwhelming majority of recent home sellers say they wish they’d done something differently when they sold their home. It’s a major undertaking and a significant financial transaction, after all. But what is the top thing home sellers say they regret? Well, if you guessed it has to do with pricing their home, you’re correct. The most common answer in a survey of sellers who sold in the past two years was that they wish they had set their home price higher. In fact, 39 percent of participants named pricing their home too low as their top regret. But while home sellers during the frenzied market of the past two years may believe they could’ve gotten more for their house, today’s sellers may have the opposite experience. That’s because, in today’s market, setting your home’s price too high may mean it struggles to sell, as there are fewer active buyers than there were in 2021 and early 2022. (source)

The inventory of homes for sale has been lower than normal for years now. It’s the primary reason for the home price spikes the housing market has seen since 2020. But according to one recent analysis from the National Association of Realtors’ consumer website, home buyers may have more homes to choose from this spring. That’s because the inventory of available homes for sale was up nearly 68 percent in February from where it was at the same time one year earlier. Danielle Hale, chief economist for the site, says the news is good for buyers, but sellers may need to adjust their expectations. “The number of homes for sale on the market is up significantly from a year ago, even though fewer homeowners have listed their home for sale in recent months,†Hale said. “With a smaller pool of buyers today and more competition from other homes on the market, home sellers will likely need to adjust their price expectations in the market this spring.†(source)

According to the Mortgage Bankers Association’s Weekly Application Survey, average mortgage rates moved higher last week across all loan categories. Rates were up for 30-year fixed-rate loans with both conforming and jumbo balances, loans backed by the Federal Housing Administration, 15-year fixed-rate loans, and 5/1 ARMs. It was the third consecutive weekly increase. Joel Kan, MBA’s vice president and deputy chief economist, says inflation concerns are behind the upward trend. “Data on inflation, employment, and economic activity have signaled that inflation may not be cooling as quickly as anticipated, which continues to put upward pressure on rates,†Kan said. With rates moving higher, demand for mortgage loan applications has slowed, dropping 5.7 percent from one week earlier, including a 6 percent decline in demand for home purchase loans. The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications. (source)

When a contract to buy a home is signed, that home’s sale is considered pending until it eventually closes weeks later. During this period, the details of the sale and financing are finalized. The lag between signings and closings makes pending sales an excellent predictor of future home sales. That’s why the National Association of Realtors tracks them each month. According to their most recent report, pending home sales increased 8.1 percent in January. It was the second consecutive increase and the largest monthly gain since June 2020. Lawrence Yun, NAR’s chief economist, says affordability was behind the improvement. “Buyers responded to better affordability from falling mortgage rates in December and January,†Yun said. Still, despite the bump, contract signings remain well below year-before levels. Yun believes home sales activity is nearing a bottom and will see incremental improvements later in the year. (source)

Sales of newly built homes were rising at the end of last year and continued to increase once 2023 arrived. In fact, according to new numbers from the U.S. Census Bureau and the Department of Housing and Urban Development, new home sales rose 7.2 percent in January – and that’s following an upward revision of December’s numbers. The increases were likely fueled by falling mortgage rates, which provided relief to winter home shoppers. So what does this mean to the average buyer? Well, any increase in new home sales is good news for buyers, since it encourages builders to build more new homes, which adds supply to the housing market and moderates prices for both new and existing homes. Right now, the inventory of homes for sale remains lower than historically normal. So rising new home sales is a positive sign for the market and buyers hoping to find a house this spring. (source)

The housing market has been through some ups-and-downs over the past year. A booming market began to slow down early in 2022, as mortgage rates climbed and caused affordability challenges for buyers. Last fall, though, mortgage rates started to decline and the drop caused housing market optimism to rise. Add to that unexpectedly strong economic data and some were feeling that the worst may be over. But according to Fannie Mae’s Economic and Strategic Research Group – which releases a monthly outlook detailing their expectations for the general economy and housing market – it may be too soon to declare market volatility a thing of the past. Doug Duncan, Fannie Mae’s senior vice president and chief economist, says recent data has been encouraging but it could reverse. “Recent data have been stronger than expected in ways that we believe are likely to lead to tighter monetary policy with attendant increases in interest rates,†Duncan said. “While optimism appears to have crept into the housing sector, it represents an increase from very low levels of activity and is at risk of declining again if rates reverse.†(source)

According to the Mortgage Bankers Association’s Weekly Applications Survey, average mortgage rates increased last week across all loan categories, including 30-year fixed-rate loans with both conforming and jumbo balances, loans backed by the Federal Housing Administration, 15-year fixed-rate loans, and 5/1 ARMs. The increases brought rates to their highest levels since November. Joel Kan, MBA’s vice president and deputy chief economist, says they also had a cooling effect on buyers. “This time of the year is typically when purchase activity ramps up, but over the past two weeks, rates have increased significantly as financial markets digest data on inflation cooling at a slower pace than expected,†Kan said. “The increase in mortgage rates has put many home buyers back on the sidelines once again, especially first-time home buyers who are most sensitive to affordability challenges and the impact of higher rates.†The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications. (source)

There was a time, not long ago, when the typical home listed for sale would be on the market for barely two weeks before it sold. With buyer demand high and the number of available homes lower than normal, the pace of the housing market was fast – nearly 90 percent of homes sold in under a month. These days, though, things have slowed down a bit and that’s good for buyers, as it gives them more time to deliberate before making an offer. But how long does the typical home stay on the market now? Well, according to new numbers from the National Association of Realtors, the typical home for sale was on the market 33 days in January, up from 19 days last year at the same time. Fifty-four percent of homes sold in less than a month. Lawrence Yun, NAR’s chief economist, says buyers are regaining negotiating power. “Inventory remains low, but buyers are beginning to have better negotiating power,†Yun said. “Homes sitting on the market for more than 60 days can be purchased for around 10 percent less than the original list price.†(source)

There have been a few factors fueling buyer demand the past three years. Certainly, historically low mortgage rates drove some Americans to buy a house sooner than they may have otherwise. But most people don’t buy a house simply because market conditions are favorable. Most of us buy because of a big life change like a new job, getting married, or having kids. That never changes, which is why in the months ahead demographics will play a bigger role in the housing market than affordability conditions. For example, a recent consumer survey found the median age of first-time buyers last year was 35 years old. The millennial generation – which is the largest generation group in the U.S. at around 72 million people – is now between their late twenties and early forties. That means a lot of Americans are entering the stage of life when they’re likely to buy their first home. It also a means spring buyers should be prepared for competition, especially in the more affordable price ranges that appeal to younger home shoppers. (source)