Freddie Mac’s Multi-Indicator Market Index in October signaled ever-stabilizing circumstances across a growing number of regions.
The index, a compendium of home-purchase applications, payment-to-income ratios and current mortgage rates, grew 59 basis points from September, and improved by 6.31% year-over-year, to a level of 81.9.
October was also marked by the addition of two new states, New York and Kansas, as well as three metro areas — New York City, Minneapolis and Palm Bay, Fla. — to Freddie Mac’s outer range of stability classification. Over the three preceding months, 43 out of 50 states and 89 of 100 metro areas, showed improving stability trends. That’s compared to 36 states and 70 metro areas improving over the three months leading to October 2014.
“The strong annual change of 6.31% is the best improvement we’ve seen in the MiMi on a year-over-year basis since July 2014,” said Len Kiefer, the government-sponsored enterprise’s deputy chief economist, in a Dec. 30 press release.
Attributing the market’s evolution to “mortgage delinquencies continuing to decline at a steady pace, especially in those hardest-hit markets and a better employment picture overall,” Kiefer added that “states in the West are still seeing some of the strongest housing activity and among those Utah really stands out.”
Kiefer warned, however, that affordability was bound to decrease over the next 12 months. “But we don’t expect tighter monetary policy to generate a spike in longer-term interest rates in the foreseeable future,” he said.