Black Knight: Signs of Cooling in Nation's Least Affordable Markets as Inventory Levels Improve; May Sees Largest Monthly Slowdown in Home Price Growth Since 2006
In May, home price growth slowed in 97 of the 100 largest U.S. housing markets, with the national annual appreciation rate dropping to 19.3%, the largest decline since 2006. Despite this, home prices increased by 1.5% month-over-month, nearly double the historical average for May. Affordability has worsened, with the payment-to-income ratio at 36.2%, while active listings rose by 107,000 in May, yet inventory remains 60% below normal levels. The report from Black Knight highlights the impact of rising interest rates and low inventory on home affordability.
- Home prices increased by 1.5% month-over-month in May.
- Active listings saw the largest increase in five years, with 107,000 new listings.
- The annual home price growth rate fell to 19.3%, the largest deceleration since 2006.
- Home affordability is at its worst since the mid-1980s, with a payment-to-income ratio of 36.2%.
- Inventory levels are still 60% below what is typical for this time of year.
-Home price growth slowed in 97 of the 100 largest U.S. housing markets in May, with the national annual appreciation rate pulling back by more than a full percentage point from the month prior
-While the slowdown to
-Markets experiencing the strongest cooling in home price growth are those with comparatively poor affordability levels and low inventory deficits
-Housing is now the least affordable it has been since the mid-1980s, when sharp Fed hikes led to double-digit mortgage rates and a greater than
-Tightening affordability then was almost entirely interest rate-driven – with income growth largely keeping up with home prices
-Today's
-Even though May saw the largest jump in housing inventory in the past five years as pending listings begin to normalize and existing listings sit longer on the market, for-sale inventory remains at a
JACKSONVILLE, Fla., July 6, 2022 /PRNewswire/ -- Today, the Data & Analytics division of Black Knight, Inc. (NYSE:BKI) released its latest Mortgage Monitor Report, based upon the company's industry-leading mortgage, real estate and public records datasets. This month's report looks at recent cooling in the annual rate of home price appreciation and the intertwined impacts of both affordability and inventory on those trends. According to Black Knight Data & Analytics President Ben Graboske, May marked the second consecutive month of cooling at the national level.
"The annual home price growth rate fell by more than a full percentage point in May, the largest monthly decline at the national level since 2006," said Graboske. "However, even with growth slowing in 97 of the top 100 U.S. markets, overall home prices still rose
"The record-low listing inventory that had been driving these price gains nationwide has also begun to improve, albeit slightly. Indeed, even with an increase in active listings of 107,000 in May – nearly double the traditional seasonal rise for the month – we are still
As mortgage interest rates continue their upward climb, this month's Mortgage Monitor also examines the resulting further deterioration in home affordability. With 30-year rates hovering close to
About the Mortgage Monitor
The Data & Analytics division of Black Knight manages the nation's leading repository of loan-level residential mortgage data and performance information covering the majority of the overall market, including tens of millions of loans across the spectrum of credit products and more than 160 million historical records. The combined insight of the Black Knight HPI and Collateral Analytics' home price and real estate data provides one of the most complete, accurate and timely measures of home prices available, covering
Black Knight's research experts carefully analyze this data to produce a summary supplemented by dozens of charts and graphs that reflect trend and point-in-time observations for the monthly Mortgage Monitor Report. To review the full report, visit: https://www.blackknightinc.com/data-reports/
About Black Knight
Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.
Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serving their customers. For more information on Black Knight, please visit www.blackknightinc.com/.
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SOURCE Black Knight, Inc.
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