A Comparative Journey - 1995 in the Housing Market vs Today
Embarking on a journey through time, let's take a nostalgic glance back at the real estate landscape of 1995. A pivotal period marked by distinctive trends, the housing market of '95 laid the groundwork for the dynamic scenario we witness today. Join us as we unravel the fascinating contrasts and parallels between the real estate market then and now.
1995: With a U.S. population of 266.6 million, existing-home sales in 1995 recorded 3.85 million. A different world with different numbers.
Today: The U.S. population has surged to 336.0 million, yet the annual pace of existing-home sales in 2023 was 4.09 million—still lower than 1995. What's changed? Dive in as we unravel the complexities of inventory and affordability.
1995: December 1995 boasted 1.58 million single-family homes for sale, with a months' supply of 4.8. Contrastingly, December 2023 saw a significant dip, with only 870,000 homes and a 3.1 months' supply.
Today: The housing affordability equation adds another layer. In 1995, the median home sales price was $114,600, significantly lower than 2023's historical high of $389,800. Mortgage interest rates in 1995 averaged 7.93%, while 2023 witnessed a lower 6.81%.
1995: In November 1995, the housing affordability index stood at 126.9, with a qualifying income of $32,112 and a mortgage payment comprising 19.6% of income.
Today: Fast forward to November 2023, and the index drops to 94.2, requiring a qualifying income of $105,504, with the mortgage payment representing 26.5% of income.
1995: First-time buyers in 1995 accounted for 42% of the market, with an average age of 31. The share of buyers using real estate agents was 81%.
Today: In 2023, first-time buyers comprised 32%, with an average age of 35. However, the reliance on real estate agents increased to 89%, reflecting the complexities of the current market.
The journey from 1995 to the present in the real estate realm is a testament to the sector's adaptability and resilience. As we navigate the contrasting currents of the past and present, one thing remains constant – the real estate market is an ever-evolving entity, shaped by the interplay of economic, technological, and societal forces. As we step into 2024, with receding mortgage rates and promising signs, the journey continues—full of twists, turns, and, hopefully, a brighter horizon for the housing market. Buckle up as we continue this enthralling ride through the annals of real estate history!
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