$\"Is$ \n

Over the past year or so, a lot of people have been talking about how tough it is to buy a home<\/a>. And while there\u2019s no arguing affordability is still tight, there are signs it\u2019s starting to get a bit better and may improve even more throughout the year. Elijah de la Campa, Senior Economist at Redfin<\/em>, says<\/a>:<\/p>\n

\u201c<\/em>We\u2019re slowly climbing our way out of an affordability hole, but we have a long way to go.<\/em><\/strong> Rates have come down from their peak and are expected to fall again by the end of the year, which should make homebuying a little more affordable and incentivize buyers to come off the sidelines.\u201d<\/em><\/p><\/blockquote>\n
Here\u2019s a look at the latest data for the three biggest factors that affect home affordability: mortgage rates<\/a>, home prices<\/a>, and wages.<\/p>\n
1. Mortgage Rates<\/strong><\/h4>\n
Mortgage rates have been volatile this year \u2013 bouncing around in the upper 6% to low 7% range. That\u2019s still quite a bit higher than where they were a couple of years ago. But there is a sliver of good news.<\/p>\n
Despite the recent volatility, rates are still lower than they were last fall when they reached nearly 8%<\/a>. On top of that, most experts still think they\u2019ll come down some over the course of the year. A recent article from Bright MLS<\/em> explains<\/a>:<\/p>\n
\u201c<\/em>Expect rates to come down in the second half of 2024 but remain above 6% this year.<\/em><\/strong> Even a modest drop in rates will bring both more buyers and more sellers into the market.\u201d<\/em>\u00a0<\/p><\/blockquote>\n
Any drop in rates<\/a> can make a difference for you. When rates go down, you can afford the home you really want more easily because your monthly payment would be lower.<\/p>\n
2. Home Prices<\/strong><\/h4>\nThe second big factor<\/a> to think about is home prices<\/a>. Most experts project<\/a> they\u2019ll keep going up<\/a> this year, but at a more normal pace. That\u2019s because there are more homes<\/a> on the market this year, but still not enough for everyone who wants to buy one. The graph below shows the latest<\/a> 2024 home price forecasts<\/a> from seven different organizations<\/a>:<\/p>\n
\u00a0 $\"No$ <\/a><\/p>\n\n
These forecasts are actually good news for you because it means the prices aren\u2019t likely to shoot up sky high like they did during the pandemic. That doesn\u2019t mean they\u2019re going to fall \u2013 they\u2019ll just rise at a slower pace.<\/p>\n
3. Wages<\/strong><\/h4>\nOne factor helping affordability right now is the fact that wages are rising. The graph below uses data<\/a> from the Federal Reserve<\/em> to show how wages have been growing over time:<\/p>\n
\u00a0 $\"No$ <\/a><\/p>\n\n
Check out the blue dotted line. That shows how wages typically rise. If you look at the right side of the graph, you\u2019ll see wages are climbing even faster than normal right now.<\/p>\n
Here\u2019s how this helps you. If your income has increased, it\u2019s easier to afford a home because you don\u2019t have to spend as big of a percentage of your paycheck on your monthly mortgage payment.<\/p>\n
Bottom Line<\/h3>\n
If you stack these factors up, you\u2019ll see mortgage rates are still projected to come down a bit later this year, home prices are going up at a more moderate pace, and wages are growing quicker than normal. Those trends are a good sign for your ability to afford a home.<\/p>\n<\/div>\n\n<\/body>","protected":false},"excerpt":{"rendered":"
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