National Housing Market Outlook

Local Affordability Issues Might Surprise You

Dean_Wehrli_web

Dean Wehrli

August 10, 2019

We all know that New York is more expensive than Texas and that relocating home buyers can get more for their money in the South. However, for local housing industry executives, what matters is how expensive each market is in comparison to its own history. Our Burns Affordability Index™ (a 10-point scale where 0 is the most affordable time in a market’s history and 10 is the least affordable time) measures the ratio of total housing costs (mortgage payment, property taxe etc.) to incomes over time in each market. By this measure, Houston and Denver appear more out of line than other markets.

Of course, affordability is a draw to Houston and Denver if you are coming from very expensive markets like California, but the value gap between California and these markets has narrowed recently. Only time will tell if this gap has narrowed permanently.

Our consumer research shows that home buyers are:

  • Moving to more affordable markets

  • Doubling up

  • Renting

  • Waiting
 

Our client research shows that builders are:

  • Building smaller homes

  • Very focused on price points below the FHA loan limit, where financing is most widely available to credit-challenged borrowers

  • Looking to tertiary submarkets where traditional single-family homes can be built at more affordable price points

  • Considering building homes for rent

  • Targeting older move-down buyers who have a lot of equity in their home

Building Market Intelligence™

Every week, we deliver analysis to over 40,000 subscribers with our Building Market Intelligence™ newsletter. Subscribe to our weekly BMI newsletters to stay current on pressing topics in the housing industry.

About The Author

Dean Wehrli
Principal
Dean helps housing sector clients figure out not just what might work and what might not, but why.

Contact Us

If you have any questions about our services or if you would like to speak to one of our experts about we can help your business, please contact Client Relations at clientservices@jbrec.com.

Products and Services Mentioned

Real Estate Consulting

Our experienced team of consultants helps clients make sound housing investment decisions. We thrive on their success and work with many clients over multiple years and numerous projects.

Metro and Regional Housing Package

An overview of major housing and economic trends, as well as forecasts across 100 MSAs nationwide. The information in this subscription package provides a complete picture of housing supply, demand, and affordability through local insight, proprietary surveys, and extensive data analysis.

Burns Metro Analysis and Forecast

A report that provides the most current and accurate information for major housing and economic conditions and forecasts at an MSA level.

Latest Insights

Design Disruption: Architects’ Floor Plan Forecasts
Keep, Stop, Start: Homebuilding’s Health Kick
$12 Billion Remodeling Boost