Buying A Home More Affordable Than Renting In 54 Percent Of U.S. Housing Markets

But 64 Percent of Population Live in Markets More Affordable to Rent Than Buy; Least Affordable Rental Markets Led by Counties in Northern California, DC, Brooklyn; Most Affordable Rental Markets in Alabama, Illinois, Ohio, Tennessee

Irvine, CA – Jan. 11, 2018 (PRNewswire) ATTOM Data Solutions, curator of the nation’s largest multi-sourced property database, today released its 2018 Rental Affordability Report, which shows that buying a median-priced home is more affordable than renting a three-bedroom property in 240 of 447 U.S. counties analyzed for the report — 54 percent.

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The analysis incorporated recently released fair market rent data for 2018 from the U.S. Department of Housing and Urban Development, wage data from the Bureau of Labor Statistics along with public record sales deed data from ATTOM Data Solutions in 447 U.S. counties with sufficient home sales data (see full methodology below).

“Although buying is still more affordable than renting in the majority of U.S. housing markets, that majority is shrinking as home price appreciation continues to outpace rental growth in most areas,” said Daren Blomquist, vice president at ATTOM Data Solutions. “Renting has clearly become the lesser of two housing affordability evils in many major population centers, with renting more affordable than buying in 76 percent of counties that have a population of 1 million or more. And when broken down by population rather than number of markets, this data shows that the majority of the U.S. population — 64 percent — live in markets that are more affordable to rent than to buy.”

Renting more affordable than buying in nation’s most populated counties
Counter to the overall trend, renting is more affordable than buying a home in the nation’s 14 most populated counties and in 30 of 39 counties with a population of 1 million or more (76 percent) — including Los Angeles County, California; Cook County (Chicago), Illinois; Harris County (Houston), Texas; Maricopa County (Phoenix), Arizona; and San Diego County, California.

Other markets with a population of more than 1 million where it is more affordable to rent than to buy a home included counties in Miami, New York City, Seattle, Las Vegas, San Jose, San Francisco and Boston.

“The thing about this data that concerns me the most is that it is now more affordable to rent in the greater Seattle area than buy. Even with solid income growth, the rapid rise in home prices is keeping many would-be buyers out of ownership,” said Matthew Gardner, chief economist with Windermere Real Estate, covering the Seattle market. “To make matters worse, rapid rental rate growth in the core King County market is forcing many renters to look farther out to find something they can afford. Seattle needs considerably more affordable housing for renters and home buyers alike. Unless something changes, the area will remain very expensive, pricing many buyers out of the market.”

Among the 39 U.S. counties analyzed in the report with a population of 1 million or more, the nine where it is more affordable to buy a home than rent included Tarrant County (Dallas), Texas; Broward County (Miami), Florida and Bexar County, (San Antonio) Texas.

Least affordable rental markets in Northern California, DC, Brooklyn
The report shows that renting a three-bedroom property requires an average of 38.8 percent of weekly wages across the 447 counties analyzed for the report.

The least affordable markets for renting were Marin County, California (79.5 percent of average wages to rent); Spotsylvania County (Washington, D.C. area), Virginia (75.5 percent) and Honolulu County, Hawaii (71.9 percent).

Most affordable rental markets in Alabama, Illinois, Ohio, Tennessee
The most affordable markets for renting were Madison County (Huntsville), Alabama (22.3 percent of average wages to rent); Tazewell County (Peoria), Illinois (23.6 percent); and Greene County (Dayton), Ohio (24.1 percent).

Rents rise faster than wages in 60 percent of markets
Average fair market rents rose faster than average weekly wages in 266 of the 447 counties analyzed in the report (60 percent), including Los Angeles County, California; Cook County, Illinois and Harris County, Texas.

Home prices rising faster than rents in 59 percent of markets
Median home prices rose faster than average fair market rents in 263 of the 447 counties analyzed in the report, including Los Angeles County, California; Cook County, Illinois and San Diego County, California.

Full Report & Methodology

About ATTOM Data Solutions
ATTOM Data Solutions is the curator of the ATTOM Data Warehouse, a multi-sourced national property database that blends property tax, deed, mortgage, foreclosure, environmental risk, natural hazard, health hazards, neighborhood characteristics and other property characteristic data for more than 150 million U.S. residential and commercial properties. The ATTOM Data Warehouse delivers actionable including bulk file licenses, APIs and customized reports.

Media:

Christine Stricker
714.873.4275
christine.stricker@attomdata.com

Data and Report Licensing:
949.502.8313
datareports@attomdata.com

All U.S. Homes Worth Cumulative $31.8 Trillion

– Renters paid a record high $485.6 billion in 2017, a $4.9 billion increase from 2016

– The entire U.S. housing stock gained $2 trillion in value over the past year.

– The value of all U.S. homes grew 6.5 percent in 2017, the fastest pace in four years.

– Los Angeles, New York and San Francisco are the most valuable housing markets, each worth more than $1 trillion.

Seattle, WA – Dec. 28, 2017 (PRNewswire) The total value of all homes in the United States is now $31.8 trillion after gaining $2 trillion in 2017.

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The cumulative value of the U.S. housing market grew at its fastest annual pace – 6.5 percent – in four years. The value of all U.S. homes rose 8 percent annually in the early stages of the housing recovery in 2013.

For many households, a home is the single largest source of wealth, but the collapse of the housing market and the ensuing Great Recession demonstrated the importance of housing to the U.S. economy as well. The housing market has gained $9 trillion since the lowest levels of the recession.

The value gained in 2017 alone is equivalent to more than the valuation of two companies the size of Apple. Over the past year, the U.S. housing market has gained $1.95 trillion, while Apple recently hit a market value of $900 billion, the first U.S. company to do so(i).

The Los Angeles and New York markets each account for more than 8 percent of the value of all U.S. housing, and are worth $2.7 trillion and $2.6 trillion, respectively. San Francisco is the only other housing market worth more than $1 trillion.

Among the 35 largest U.S. markets, Columbus grew the most in 2017, gaining 15.1 percent. San Jose, Dallas, Seattle, Tampa, Las Vegas and Charlotte, N.C. also grew by 10 percent or more over the past year.

This was a record year for home values as the national housing stock reached record heights in 2017,” said Zillow® Senior Economist Aaron Terrazas. “Strong demand from buyers and the ongoing inventory shortage keep pushing values higher, especially in some of the nation’s booming coastal markets. Renters spent more than ever on rent this year, but the amount they spent grew at the slowest pace in recent years as more renters transitioned into homeownership and new rental supply slowed rent growth across the country. Despite recent changes to federal tax laws that have historically made homeownership financially attractive, the long-term dynamics pushing up home values and rents are unlikely to change significantly in 2018.”

Renters spent a record $485.6 billion in 2017, an increase of $4.9 billion from 2016. Renters in New York and Los Angeles spent the most on rent over the past year. These markets are also home to the largest number of renter households.

San Francisco rents are so high that renters collectively paid $616 million more in rent than Chicago renters did, despite there being 467,000 fewer renters in San Francisco than in Chicago.

Las Vegas, Minneapolis and Charlotte, N.C. had the largest gains in the total amount of rent paid, with each increasing by more than 7 percent since 2016.

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Zillow

Zillow® is the leading real estate and rental marketplace dedicated to empowering consumers with data, inspiration and knowledge around the place they call home, and connecting them with the best local professionals who can help. In addition, Zillow operates an industry-leading economics and analytics bureau led by Zillow’s Chief Economist Dr. Svenja Gudell. Dr. Gudell and her team of economists and data analysts produce extensive housing data and research covering more than 450 markets at Zillow Real Estate Research. Zillow also sponsors the quarterly Zillow Home Price Expectations Survey, which asks more than 100 leading economists, real estate experts and investment and market strategists to predict the path of the Zillow Home Value Index over the next five years. Launched in 2006, Zillow is owned and operated by Zillow Group, Inc. (NASDAQ: Z and ZG), and headquartered in Seattle.

Zillow is a registered trademark of Zillow, Inc.

Americans Voice Support for Net Neutrality

Source: Statista

Last Wednesday, the Federal Communications Commission (FCC) released its plan to reverse net neutrality regulations that were put in place under the Obama administration in 2015. Net neutrality is the concept that all internet traffic should be treated equally by internet service providers (ISPs), regardless of the content that is delivered or who it was created by.

The new proposal, named the Restoring Internet Freedom order, would no longer classify ISPs as public utilities but rather as information services, meaning that telecommunication companies such as Comcast or Verizon would be legally allowed to create so-called fast lanes for content by providers that either pay for preferential treatment or that the ISP itself has a financial stake in, such as Comcast has in NBC Universal. While the FCC argues that scrapping net neutrality rules would boost investments and innovation by limiting government regulation, advocates of net neutrality argue that the concept creates a level playing field for content providers and fear that getting rid of net neutrality would stifle competition and further increase concentration in the online media landscape.

As our chart, based on a Consumer Reports survey, shows, the majority of Americans support the current net neutrality rules and don’t think that ISPs should be allowed to regulate what content their customers can access. The FCC will vote on the order on December 14 and considering the Republican majority in the commission, it is expected to pass regardless of the vocal opposition from companies and consumers alike.

Net Neutrality Infograhic

CoreLogic US Home Price Report Reveals Nearly Half of the Nation’s Largest 50 Markets are Overvalued

  • National Home Prices Up 7 Percent in September 2017
  • Home Prices Projected to Increase 4.7 Percent by September 2018
  • West Virginia Was the Only State That Lost Ground, Down 0.3 Percent

IRVINE, CA – November 7th 2017 (BUSINESS WIRE) CoreLogic® (NYSE: CLGX), a leading global property information, analytics and data-enabled solutions provider, today released its CoreLogic Home Price Index (HPI™) and HPI Forecast™ for September 2017, which shows home prices are up strongly both year over year and month over month. Home prices nationally increased year over year by 7 percent from September 2016 to September 2017, and on a month-over-month basis, home prices increased by 0.9 percent in September 2017 compared with August 2017,* according to the CoreLogic HPI.

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Looking ahead, the CoreLogic HPI Forecast indicates that home prices will increase by 4.7 percent on a year-over-year basis from September 2017 to September 2018, and on a month-over-month basis home prices are expected to decrease by 0.1 percent from September 2017 to October 2017. The CoreLogic HPI Forecast is a projection of home prices using the CoreLogic HPI and other economic variables. Values are derived from state-level forecasts by weighting indices according to the number of owner-occupied households for each state.

“Heading into the fall, home price growth continues to grow at a brisk pace,” said Dr. Frank Nothaft, chief economist for CoreLogic. “This appreciation reflects the low for-sale inventory that is holding back sales and pushing up prices. The CoreLogic Single-Family Rent Index rose about 3 percent over the last year, less than half the rise in the national Home Price Index.”

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According to CoreLogic Market Condition Indicators (MCI) data, an analysis of housing values in the country’s 100 largest metropolitan areas based on housing stock, 36 percent of cities have an overvalued housing stock as of September 2017. The MCI analysis categorizes home prices in individual markets as undervalued, at value or overvalued by comparing home prices to their long-run, sustainable levels, which are supported by local market fundamentals such as disposable income. Also, as of September, 28 percent of the top 100 metropolitan areas were undervalued and 36 percent were at value. When looking at only the top 50 markets based on housing stock, 48 percent were overvalued, 16 percent were undervalued and 36 percent were at value. The MCI analysis defines an overvalued housing market as one in which home prices are at least 10 percent higher than the long-term, sustainable level, while an undervalued housing market is one in which home prices are at least 10 percent below the sustainable level.

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“A strengthening economy, healthy consumer balance sheets and low mortgage interest rates are supporting the continued strong demand for residential real estate,” said Frank Martell, president and CEO of CoreLogic. “While demand and home price growth is in a sweet spot, a third of metropolitan markets are overvalued and this will become more of an issue if prices continue to rise next year as we anticipate.“

*August 2017 data was revised. Revisions with public records data are standard, and to ensure accuracy, CoreLogic incorporates the newly released public data to provide updated results.

Methodology
The CoreLogic HPI™ is built on industry-leading public record, servicing and securities real-estate databases and incorporates more than 40 years of repeat-sales transactions for analyzing home price trends. Generally released on the first Tuesday of each month with an average five-week lag, the CoreLogic HPI is designed to provide an early indication of home price trends by market segment and for the “Single-Family Combined” tier representing the most comprehensive set of properties, including all sales for single-family attached and single-family detached properties. The indexes are fully revised with each release and employ techniques to signal turning points sooner. The CoreLogic HPI provides measures for multiple market segments, referred to as tiers, based on property type, price, time between sales, loan type (conforming vs. non-conforming) and distressed sales. Broad national coverage is available from the national level down to ZIP Code, including non-disclosure states.

CoreLogic HPI Forecasts™ are based on a two-stage, error-correction econometric model that combines the equilibrium home price—as a function of real disposable income per capita—with short-run fluctuations caused by market momentum, mean-reversion, and exogenous economic shocks like changes in the unemployment rate. With a 30-year forecast horizon, CoreLogic HPI Forecasts project CoreLogic HPI levels for two tiers—“Single-Family Combined” (both attached and detached) and “Single-Family Combined Excluding Distressed Sales.” As a companion to the CoreLogic HPI Forecasts, Stress-Testing Scenarios align with Comprehensive Capital Analysis and Review (CCAR) national scenarios to project five years of home prices under baseline, adverse and severely adverse scenarios at state, Core Based Statistical Area (CBSA) and ZIP Code levels. The forecast accuracy represents a 95-percent statistical confidence interval with a +/- 2.0 percent margin of error for the index.

Source: CoreLogic
The data provided are for use only by the primary recipient or the primary recipient’s publication or broadcast. This data may not be resold, republished or licensed to any other source, including publications and sources owned by the primary recipient’s parent company without prior written permission from CoreLogic. Any CoreLogic data used for publication or broadcast, in whole or in part, must be sourced as coming from CoreLogic, a data and analytics company. For use with broadcast or web content, the citation must directly accompany first reference of the data. If the data are illustrated with maps, charts, graphs or other visual elements, the CoreLogic logo must be included on screen or website. For questions, analysis or interpretation of the data, contact Lori Guyton at lguyton@cvic.com or Bill Campbell at bill@campbelllewis.com. Data provided may not be modified without the prior written permission of CoreLogic. Do not use the data in any unlawful manner. The data are compiled from public records, contributory databases and proprietary analytics, and its accuracy is dependent upon these sources.

About CoreLogic
CoreLogic (NYSE: CLGX) is a leading global property information, analytics and data-enabled solutions provider. The company’s combined data from public, contributory and proprietary sources includes over 4.5 billion records spanning more than 50 years, providing detailed coverage of property, mortgages and other encumbrances, consumer credit, tenancy, location, hazard risk and related performance information. The markets CoreLogic serves include real estate and mortgage finance, insurance, capital markets, and the public sector. CoreLogic delivers value to clients through unique data, analytics, workflow technology, advisory and managed services. Clients rely on CoreLogic to help identify and manage growth opportunities, improve performance and mitigate risk. Headquartered in Irvine, Calif., CoreLogic operates in North America, Western Europe and Asia Pacific. For more information, please visit www.corelogic.com.

CORELOGIC, the CoreLogic logo, CoreLogic HPI, CoreLogic HPI Forecast and HPI are trademarks of CoreLogic, Inc. and/or its subsidiaries.

Contacts

CoreLogic

For real estate industry and trade media:
Bill Campbell
(212) 995-8057
bill@campbelllewis.com

or

For general news media:
Lori Guyton
(901) 277-6066
lguyton@cvic.com