- The Black Knight Home Price Index (HPI) hit an all-time high in
June, this time on both seasonally adjusted (SA) and unadjusted
levels, with nearly every major market experiencing
month-over-month growth
- Prices have now reached new peaks in 30 of the 50 largest
markets, with several northeastern metros currently 5-8% above 2022
highs
- Home prices rose by +.67% (SA) month-over-month in June, while
after slowing for 14 consecutive months, the annual growth rate
rose to +0.8% in June, up from a revised +0.2% in May
- Broadly speaking, annual growth is strongest among Midwest and
Northeast markets, while West Coast and pandemic boom markets
continue to see prices run below last year's levels
- Despite overall outstanding mortgage debt surpassing $13T for
the first time ever, home price growth has also pushed homeowner
equity levels back to within 3% of 2022 peaks
- Total mortgage holder equity topped $16T again in June,
with tappable equity – the amount that can be accessed while
retaining a 20% equity stake – climbing to $10.5T, within $434B (4%) of 2022 peaks
- While the number of underwater homeowners is up nearly 70% from
last year, it remains 52% below 2019 levels, with just 344K (0.65%) of mortgage holders nationwide
currently owing more than their home is worth
JACKSONVILLE, Fla., Aug. 7, 2023
/PRNewswire/ -- Today, the Data & Analytics division of
Black Knight, Inc. (NYSE:BKI) released its August 2023 Mortgage Monitor Report, based on the
company's industry-leading mortgage, real estate and public records
data sets. This month's report looks again at the reheating housing
market nationwide, with home prices hitting new peaks at the
national as well as local levels, and no end in sight to the
constrictive lack of for-sale inventory driving the price
increases. As Black Knight Vice President of Enterprise Research
Andy Walden explains,
backward-looking annual home price growth rates are beginning to
inflect driven by the seasonally adjusted monthly increases the
Black Knight Home Price Index (HPI) has been tracking in near real
time as 2023 has progressed.
"We've been noting for some months that the recent rate of home
price gains would have a lagging, but significant, impact on the
annual rate of appreciation," said Walden. "Well, June marked that
inflection point. Not only has the Black Knight HPI reached a new
record high – on both seasonally adjusted and non-adjusted bases –
but 60% of major markets have done so as well. After slowing for 14
straight months, the annual growth rate jumped back to 0.8% in
June, up from just 0.2% in May, amid widespread growth that saw
annual rates of appreciation inflect and begin to trend higher in
more than 80% of markets. Rising home prices have boosted homeowner
equity levels as well, which had been retreating from their 2022
highs not very long ago. In fact, despite total outstanding
mortgage debt topping $13T for the first time in history, much of
the decline in equity we'd tracked since last year's peak has since
been recovered.
"Overall mortgage-holder equity is now back above $16T, with
some $10.5T of that being 'tappable,'
or available for the homeowner to borrow against while still
maintaining a relatively conservative 20% equity stake. The average
mortgage holder has some $199K in
tappable equity available to them; down somewhat from 2022's
historic highs but still a historically large amount regardless. In
terms of negative equity, or 'underwater borrowers,' it's a nearly
nonexistent phenomenon in today's market – just 344K homeowners currently owe more on their homes
than the properties are worth. Yes, it's true that is a 70% jump
from this time last year – which may sound ominous – but everything
is relative. There are less than half as many underwater homeowners
than there were in 2019 before the onset of the pandemic, with only
3.9% having less than 10% equity, down from 6.6% in 2019."
Strong equity positions are one component of today's
historically strong mortgage performance, but this month's report
also quantifies the savings associated with recent refinance waves,
which continue to pay dividends in terms of both performance and
overall economic benefit. While affordability for prospective
homebuyers is nearly the worst it's been in 37 years, low interest
rates locked in during the COVID era continue to keep payments down
for existing homeowners, contributing to low delinquency levels.
Despite the average unpaid principal balance of existing mortgages
hitting an all-time high in June ($242K), the average interest rate on those loans
sits at just 3.94%. Existing homeowners who have benefitted from
$42B in cumulative savings through
refinance in the past three years are now also benefitting from
strong income growth as well. Further, existing homeowners need
just 21% of the median household income to make the average monthly
P&I payment – as opposed to more than 36% for prospective
homebuyers in today's market. The small relative share of income
needed for existing homeowners to meet their mortgage obligations,
along with the strong credit quality of today's mortgage holders
and an acute focus on loss mitigation by the industry at large, are
all contributing to today's 16-year low in seriously delinquent
mortgages.
Much more information on these and other topics can be found in
this month's Mortgage Monitor.
Note: beginning with this month's report, the naming
convention of the Mortgage Monitor has changed to reflect month of
release as opposed to traditional McDash monthly mortgage
performance data aggregation. As Black Knight has added larger,
more varied, and timely data sets – including McDash Flash, which
pushes performance data closer to real time – the former naming
schema failed to reflect the currency of the information used for
analysis.
About the Mortgage Monitor
The Data & Analytics division of Black Knight manages the
nation's leading repository of loan-level residential mortgage data
and performance information covering the majority of the overall
market, including tens of millions of loans across the spectrum of
credit products and more than 160 million historical records. The
combined insight of the Black Knight HPI and Collateral Analytics'
home price and real estate data provides one of the most complete,
accurate and timely measures of home prices available, covering 95%
of U.S. residential properties down to the ZIP-code level. In
addition, the company maintains one of the most robust public
property records databases available, covering 99.9% of the U.S.
population and households from more than 3,100 counties.
Black Knight's research experts carefully analyze this data to
produce a summary supplemented by dozens of charts and graphs that
reflect trend and point-in-time observations for the monthly
Mortgage Monitor Report. To review the full report, visit:
https://www.blackknightinc.com/data-reports/
About Black Knight
Black Knight, Inc. (NYSE:BKI) is an
award-winning software, data and analytics company that drives
innovation in the mortgage lending and servicing and real estate
industries, as well as the capital and secondary markets.
Businesses leverage our robust, integrated solutions across the
entire homeownership life cycle to help retain existing customers,
gain new customers, mitigate risk and operate more effectively.
Our clients rely on our proven, comprehensive, scalable products
and our unwavering commitment to delivering superior client support
to achieve their strategic goals and better serving their
customers. For more information on Black Knight, please visit
www.blackknightinc.com/.
For more
information:
|
|
Michelle Kersch
|
Mitch
Cohen
|
904.854.5043
|
704.890.8158
|
michelle.kersch@bkfs.com
|
mitch.cohen@bkfs.com
|
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SOURCE Black Knight, Inc.