The Great Recession: It was the best of times, it was the worst of times — for the housing market, at least.
According to the National Association of Realtors, home affordability is down, mortgage rates are up and the “historically low rates” are on their way to becoming a thing of the past.
Though this may be good news for the stability of the economy, the NAR data also show that while incomes have improved over the past year, they haven’t kept up with the housing market’s rising prices. Because of this, it’s likely that affordability will continue to decline, outpacing income level growth by significant margins.
The New York Times also reports that, in the wake of the recession, reverse mortgages are in for some major changes, making it harder for seniors to turn their equity into cash.
As the Times’ Tara Siegel Bernard reports, the Federal Housing Administration has put new limits on reverse mortgages, decreasing the amount that can be withdrawn from a reverse mortgage in the first year and lessening the overall amount available by about 15 percent.
“As a result,” Siegel wrote on Friday, “some people with heavy debt who were hoping a reverse mortgage would solve their financial problems may find that it is no longer a viable option.”
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