Affording a mortgage payment is possible for many prospective homeowners. Why then, by all accounts, is un-affordability plaguing the market? Why is the perception of affordability so negative? Researchers at Freddie Mac offered several answers to that question in its latest Insight, the first one being perception. Homebuyers struggling to find reasonably-priced listings perceive the housing market in general as unaffordable — a reasonable conclusion, if their only options to date have been out-of-reach stock. Secondly, the high likelihood for competition (i.e., bidding wars) is off-putting, both for first-time homebuyers and for sellers re-entering the market. The latter’s hesitation is... Read More
What’s Feeding the Affordability Perception?