Almost forgot to touch on the one stat that NAR considered more important than any other; The Mortgage Servicing Cost to Income Ratio.
They said it was a little high, but not as high as in the early 1980’s (like it was a GOOD thing!) Unless they were only referring to the one spike in 1981 when the Prime Rate was pegged at 20%+, then we are now in fact well above any other point on their nice little graph. We are well above even though we have historically low interest rates and loan points! Ah, but home prices are not too high. If rates and points (the other small factors in calculating the mortgage servicing cost) return to more “normal” levels, then I’m sure those home prices will hold firm, right? Not.