Home values are rising in practically every corner of the country, and median sale prices in dozens of metro areas have posted double-digit yearly percentage increases, according to the Wall Street Journal. Analysts attribute this to a record-low supply and a flood of well-off workers looking for second homes or space for home offices.
- Another major factor: Roughly one in every five houses sold is bought by someone who never moves in. WSJ counted more than 200 companies and investment firms in the house hunt competing with individual buyers, including Invitation Homes; American Homes 4 Rent; Opendoor; J.P. Morgan Asset Management; and BlackRock.
- Why this time is different: Mortgage credit availability, a measure of lenders’ willingness to issue mortgages, is near its lowest level since 2014. About 70% of mortgages issued in 2020 went to borrowers with credit scores of at least 760, up from 61% in 2019, according to the Federal Reserve Bank of New York.
- Worth Noting: Lenders’ concerns about the financial stability of borrowers prompted them to increase verification of employment and income. Some borrowers were asked to sign statements affirming that they had no intention of requesting forbearance after being approved for a mortgage, the Journal noted.
- NYC luxury market joins the party, but not out of the woods yet: Manhattan co-op and condo sales in Q1 exceeded year-earlier levels for the first time in four quarters. Though the gap between supply and demand has narrowed since 2020, there are still more than 7,000 apartments sitting on the market. For the luxury market, sale prices dropped by more than 15% over the course of 2020.[WSJ+WSJ2+NYTimes+MillerSamuel]