Zillow’s Stan Humphries and Fannie Mae's chief economist Richard Koss believe "the housing thaw is finally underway," as mortgage rates remain low, starts are elevated, and prices are still below pre-cash levels, MarketWatch reports.
When taking out a new mortgage, absorbing 15% of a household's income is about average— well below historical norms —while renting is taking about a 30% bite out of a paycheck. “Renting,” says Humphries, “has never been this expensive.”
Recent data on housing is positive. The Commerce Department reports that housing starts in September rose to a seasonally adjusted annual rate of 1.2 million units, the sixth straight month in which starts were above 1 million. Nationally home prices are expected to rise 3% this year.
... While the housing market is not back to normal, it is much healthier than two years ago. And both Humphries and Koss see continued growth ahead. Humphries told the business economists, “household formation has picked up, a sign that the demand for housing will continue to be strong.” Koss said, “the housing thaw is finally underway.”