Looking into the coming year, though, NAR's Q4 Housing Opportunities and Market Experience survey reports a decline in confidence among renters. Fifty-seven percent of renters said now is a good time to buy, down from 60% in Q3 and 68% a year ago. The figure for homeowners, 78%, is unchanged from the previous quarter, although down from 82% a year ago.

“Rents and home prices outpacing incomes and scant supply in the affordable price range has been a prominent headwind for many prospective buyers this year,” Yun says. “Making matters worse, the unwelcoming reality of higher mortgage rates since the election is likely further holding back confidence. Younger households, renters and those living in the costlier West region—where prices have soared in recent months—are the least optimistic about buying.”

Several economic factors have resulted in net positives for the multifamily sector and prices in core markets are at an all-time high. But just how long can the market continue on this trajectory? Join us at RealShare Apartments East on Feb. 28 and March 1, 2017 for insights on succeeding in the right markets as well as navigating and finding opportunities in the more challenging ones. Learn more.

IRVINE, CA—Housing affordability is now at its lowest point since the fourth quarter of 2008, ATTOM Data Solutions said Thursday. Separately, the National Association of Realtors predicted last week that affordability issues would limit the rate of housing sales growth next year, despite the fact that NAR reported this week that existing-home transactions posted their best showing in November since early 2007.

“Rapid home price appreciation and tepid wage growth have combined to erode home affordability during this housing recovery, and the recent uptick in mortgage rates only accelerated that trend in the fourth quarter,” says Daren Blomquist, SVP at Irvine, CA-based ATTOM. “The prospect of further interest rate hikes in 2017 will likely cause further deterioration of home affordability next year. Absent a strong resurgence in wage growth, that will put downward pressure on home price appreciation in many local markets.”

ATTOM's Q4 2016 Home Affordability Index, issued Thursday, found that annual home price appreciation outpaced wage growth in 81% of markets during Q4, up from 77% in Q3. In addition, 29% of US county housing markets were less affordable than their historic affordability averages in Q4, up from 24% of markets in the previous quarter and up from 13% a year ago. That represents the highest share since Q3 2009, when 47% of county markets were less affordable than their historic averages.

NAR's chief economist, Lawrence Yun, attributes the run of volume gains in existing-home sales—including for-sale apartments—to “the healthiest job market since the Great Recession and the anticipation of some buyers to close on a home” before mortgage rates begin rising from their historic low levels. November's sales picture reflected a 0.7% increase over the previous month, to a seasonally adjusted annual rate of 5.61 million units.

Looking into the coming year, though, NAR's Q4 Housing Opportunities and Market Experience survey reports a decline in confidence among renters. Fifty-seven percent of renters said now is a good time to buy, down from 60% in Q3 and 68% a year ago. The figure for homeowners, 78%, is unchanged from the previous quarter, although down from 82% a year ago.

“Rents and home prices outpacing incomes and scant supply in the affordable price range has been a prominent headwind for many prospective buyers this year,” Yun says. “Making matters worse, the unwelcoming reality of higher mortgage rates since the election is likely further holding back confidence. Younger households, renters and those living in the costlier West region—where prices have soared in recent months—are the least optimistic about buying.”

Several economic factors have resulted in net positives for the multifamily sector and prices in core markets are at an all-time high. But just how long can the market continue on this trajectory? Join us at RealShare Apartments East on Feb. 28 and March 1, 2017 for insights on succeeding in the right markets as well as navigating and finding opportunities in the more challenging ones. Learn more.