Housing Prices & Rates Looking Pretty Decent To Start 2019: investor David Schawel (CHARTS)

David Schawel, chief investment officer of wealth management firm Family Management Corporation, posted some great analysis of Goldman’s housing outlook on twitter yesterday. Quick summary:

– On national basis, home buying and renting affordability pretty average

– Less than 5% of people owe more than their mortgages, down from post-crisis peak of +25%

– People’s home equity closely tracks value of their stocks

– The Fed’s mortgage bond buying since 2009 has helped keep rates stable

– Most refis are cash-out now because of newfound equity with rising home prices, but dollar amount of total cash out is historically low (I think this will change in 2019 as the credit cycle matures and more people take out more money)

– The percent of income people spend on their monthly bills is low historically, but it’s not that low and may be artificially low because of low rates (definitely an important one to watch in 2019)

– Overall, things look better now heading into a possible late-2019 or 2020 recession because mortgages are being made with way tighter standards and people aren’t quite as leveraged.

Check out David’s detailed comments with Goldman charts below.

Thanks David. Great stuff.
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Follow David Schawel’s CIO commentary (Family Management Corporation)

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