Weekly Special | July 8, 2024

Good News For Homeowners

Having been properly chastised by a long-time reader for constantly delivering bad news about the housing market, I have committed today’s newsletter to delivering good news.

The graph above shows that home values continue to rise. The dashed line represents the trend from the 1990s carried through today, illustrating that today’s values are significantly higher than what we would have forecast back in 2000.

To provide a clear example of the benefits for homeowners versus renters, I gathered information on prices, rents, rates, and costs to create the table below, examining how buyers and renters fared for those making a decision at the end of 2014.

The median single-family home renter paid a deposit of $972 and an average monthly rent of $1,226, totaling $137,117 before getting the $972 deposit back when they moved out on July 1 of this year.

The median homebuyer paid $13,496 in down-payment and closing costs, with an average monthly payment of $882 (including a 35% increase for taxes, insurance, and maintenance), totaling $114,034.

The median homeowner received a check at closing on June 30, 2024, for $269,719 (more than double their full expenditure). Rising values are good!

The original one-page Weekly Special PDF is still available.