Affordability will become a headwind for further rapid home price gains, according to the fall edition of the Housing and Mortgage Market Review (HaMMR), released today by Arch Mortgage Insurance Company. 

The new issue is authored by Parker Ross, who recently joined Arch Global Mortgage Group as senior vice president and chief economist.

“Demand for housing surged in response to the pandemic and should remain strong in the years to come as Millennials age into their prime homebuying years,” Ross said. “Rapid home price growth has been a consequence of constrained housing supply and record-low mortgage rates that allowed affordability to remain roughly in line with its historical average. Going into the end of 2021 and next year, mortgage rates are poised to rise and homebuilding constraints should be partly resolved, which in turn should moderate the pace of home price appreciation.”

The Fall HaMMR also reviews key factors driving the ongoing housing shortage and Millennial housing demand, and investigates the widespread perception that the pandemic prompted an exodus from major U.S. cities to suburbs and exurbs.

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