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Affordability Keeping a Lid on Purchase Activity
Thursday, March 31, 2016
Freddie Mac's Multi-Indicator Market Index (MiMi) is now showing that most of the nation's housing markets are, at a minimum, on the outer range of their normal housing activity. The national MiMi in January was 82.7, a .18 percent improvement from December and a three-month positive change of 1.46 percent. Since January 2015 the MiMi value has risen by 7.57 percent.
Freddie Mac constructs its index to monitor and measure the stability of the nation's housing market and markets in all 50 states, the District of Columbia and the top 100 metro markets. It is compiled from local area housing data including home purchase applications, payment-to-income ratios (changes in home purchasing power based on house prices, mortgage rates and household income), and proportion of on-time mortgage payments in each market, and data on employment. The company combines the local information it with its own proprietary data to show where each market stands relative to its own historic range of housing and activity and the direction in which it is trending. A market can fall outside its stable range by being too weak to generate enough demand for a well-balanced housing market or by overheating to an unsustainable level of activity. The MiMi is up 40 percent from its all-time low in October 2010 but remains well below its high of 121.7.
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