New Data: Home Affordability a Problem in 80% of US Counties

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Home Affordability a Problem in 80% of US Counties link

• The national median home price rose to $360,000, a 7.3% increase from the previous quarter. This has made homeownership unaffordable in 80% of U.S. counties.

• Major homeownership expenses now consume 35.1% of the average national wage, the highest since 2007. To afford a typical home, an annual income of $90,598 is needed, significantly above the average wage of $72,358.

• In over a third of the markets, housing costs consume at least 43% of average local wages. This disparity highlights the severe affordability crisis in many regions.

Industrial Absorption Doubles As Vacancy Ticks Higher link

• Industrial property absorption doubled in 2Q2024 to 46.3 million square feet, indicating strong market demand. This uptick comes despite the industrial vacancy rate rising to 6.1%, the highest in nine years.

• The current vacancy rate, while increased, remains below the 10-year pre-pandemic average of 7%. This suggests that overall market fundamentals are still robust despite recent challenges.

• Jason Price from Cushman & Wakefield noted increasing demand following a sluggish Q1. The rise in absorption reflects healthy market activity, even as vacancy rates have climbed.

More Price Cuts As Inventory Continues To Grow link

• Inventory of unsold single-family homes rose by just over 1% to 653,000, with 40% more homes on the market compared to last year. This increase is expected to continue as mortgage rates remain high.

• New listings for single-family homes reached 71,000 this week, a 12% increase from last year. However, the total number of sellers is still below the peak levels seen in July 2022.

• Price reductions are becoming more common, with 38% of listings cutting their prices. This trend indicates weakening demand, despite the median home price holding steady at $455,000, unchanged from last year.

The Potential Impact of a DJI Drone Ban on Commercial Real Estate link

• A U.S. bill targeting DJI drones could ban new sales and possibly revoke FCC authorizations for existing drones, impacting commercial real estate operations. This legislation aims to address national security concerns over Chinese surveillance.

• DJI dominates over 70% of the global drone market, and a ban would force American businesses to seek alternatives, potentially disrupting real estate marketing and management practices. This could lead to increased costs and reduced efficiency.

• If enacted, a transition period of three years or more is likely, allowing time for adjustments and potential sales of DJI's business to non-Chinese entities. This window might mitigate some immediate operational disruptions for real estate professionals.

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That is some house in Houston

Link to the listing

That's all, folks.

Cheers,

Vidit

P.S - Read past newsletters here