Home Affordability

"Rates are up across the board, including 30-year fixed rates, 15-year fixed rates, and 5/1 adjustable-rate mortgage (ARM) rates. As of April 2022, the median home price in America stood at $344,141, a 20.9 percent leap from a year before, Zillow states."

Last year, a 30-year fixed rate mortgage was around 3 percent. The monthly mortgage payment on the average $270,000 home, assuming a 20-percent down payment, would have been $1,200 per month. (I'm not touching any of the assumptions in the mortgage calculator.)

This year, this down payment would be $14,000 more and the monthly mortgage payment $1,760, an increase of 47 percent.

If the homebuyer could only afford $1200 per month, they can only afford a house that is around $210,000, a decline of about 22 percent.

Home affordability is in a death spiral.