Housing Finance and Inflation Watch Week32

Housing Finance and Inflation Watch Week32

Housing Finance and Inflation Watch Week32

Housing Finance and Inflation Watch Week32

Housing Finance and Inflation Watch Week32

Housing Finance and Inflation Watch Week32

Housing Finance and Inflation Watch Week32

Housing Finance and Inflation Watch Week32

Housing Finance and Inflation Watch Week32

​​​​​​​Saul Klein
August 17, 2022
4 min

The AEI Housing Center issues its weekly report on Housing Finance and Inflation prepared by Edward Pinto and Tobias Peter

PDF to full report
 

Key takeaways:

  • The 10-year old seller’s market continues, evidenced by:
    • Modest purchase volume declines, in spite of a cumulative 39% increase in constant quality HPA since January 2020,
    • Historically tight supply,
    • The work from home revolution, and
    • Arbitrage opportunities due to metro & regional price differences.
  • Purchase volume for week 32 is down 22% and 16% from 2021 & 2019, respectively, with HPA projected to moderate to 9.0% in September.
  • If the current mortgage rate of around 6% holds, we expect December 2022 HPA to slow to 4-6% (y-o-y ) as demand will further moderate and supply will increase. HPA declines seem plausible at the high end of expensive markets, at the low end of some FHA markets, and in metros with stagnating or declining job growth.
  • While in the midst of the most rapid slowdown in Home Price Appreciation (HPA) since the bust of 2007-2011, demand pull inflation continues to exert a strong influence on general inflation.
  • While HPA is rapidly slowing, loan originations (other than FHA) continue to exhibit stressed mortgage default rates that will contain default levels.

 

Saul Klein

Saul Klein is widely recognized as the real estate industry’s first Internet Evangelist. He was selected by the National Association Of REALTORS® as one of the “25 Most Influential People in the Real Estate Industry” in 2003, and has been selected as one of the “100 Most Influential Real Estate People” by Inman News in 2005, 2006, 2007, 2008, 2009, 2010 and 2011, 2012, 2013.

Contact: Saul@RealTown.com
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