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RIA

Housing Affordability

Here's an interesting chart showing the divergence of 30 year mortgage rates and housing affordability, from the editors at Real Investment Advice.

Housing-Affordability-RIA.jpgClick Image to Enlarge

They note,

"The graph charts the stunning rise in mortgage rates and their effects on housing affordability. On January 1, 2022, only ten months ago, the 30-year mortgage rate was 3.22%. A potential buyer looking for monthly mortgage payments of $3,000 could afford to buy a house worth $692,000. Today mortgage rates are north of 7%. The same home buyer today can only afford a house worth $444,000. Either mortgage rates fall quickly, or house prices will have to adjust significantly."