Note. March 2022 data is the latest available from Case-Shiller as I write this on May 31, 2022. The data is a 3-month moving average so what they call March is really the January-March average.


The U.S. Real Mortgage Payment Price is now higher than at the peak of the S&L boom and is close to the peak of 2000s boom.

And this data is only through March! House prices and mortgage interest rates are higher now than in March. The April number for the U.S. may match the 2006 peak for this measure of house unaffordability.

For San Francisco and Seattle, prices are already higher than the 2006 peak for this metric.

U.S. House Prices Up More in Last 12 Months than Any Year in Last 35 Years

And house prices have increased more in the last 12 months than in any other 12-month period in the Case-Shiller data series for these 6 metros;

  • Dallas (since 2000)
  • Atlanta (since 1991)
  • Seattle (since 1990)
  • Tampa (since 1987)
  • Denver (since 1987)
  • Charlotte (since 1987)

Prices Peak This Summer?

The aggressiveness of the Fed makes me feel a bit more confident about what I said last month, that the current cycle will peak this summer.

This Time is Different

Although he’s mentioned Volcker several times, I sure hope Powell understands how different the mortgage industry is today.

The industry is much quicker to foreclose than back in the S&L days and that means a small house price decline can turn into a large house price decline a lot more easily today.

An above-average number of foreclosures being sold below market value can cause a price and foreclosure cascade.

If we see an above-average number of foreclosures next year, we sure don’t want them to be sold at fire-sale prices. S&Ls were slow to foreclose and they didn’t dump their foreclosures on the market at any price.

Note. You can find interactive versions of these charts here.


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