21 housing market statistics as the world fears a crash

This past year or so, for the first time in a long time, has people talking about the housing market going backwards. 

I published a piece last November about why I believe that, while this is a justified fear, the doomsday predictions may be overly pessimistic.

Nonetheless, with the world transitioning to a high-interest rate environment, mortgage rates have gone north and people are wary about their houses losing value. 

Here are 21 stats about the always-dynamic housing market. 

21 Housing market statistics

1. Interest rates are the highest since 2008

The rise of interest rates is what has sparked a softening in the housing market. Higher interest rates means more expensive mortgage payments, which in turn pulls house prices down. 

The all-important Fed funds rate – which feeds through to all interest rates in the economy – is currently between 4.5% and 4.75%, the highest since the Great Financial Crash in 2008. 

2. Speed of interest rate hikes in 2022 was the fastest ever

It is not only the size of interest rate hikes that have taken the market by surprise. It is also the pace. 

Inflation broke onto the scene last year and central banks were forced to hike rates aggressively. In the US, rates were near zero less than a year ago. In 2022, rates rose by close to 4% in a nine month period – faster than the previous quickest rate-hiking cycle of 1988/89. 

3. Market is expecting interest rates to rise further

The market is expecting rates to move higher again. Current expectations have the Federal Reserve hiking rates to between 5.25% and 5.5% this year. Some predictions are even more extreme, pointing to a slim chance that 6% is hit. 

4. 30-Year Mortgage Rate in US hit the highest mark since 2002

The Fed rate is the baseline and feeds through to the economy at large. But the 30-Year mortgage rate in the US is often viewed as the most indicative of the pressure mortgage payments can put on. 

This rate pushed past 7% in November, the first time since April 2002. It has fallen back a bit since but remains extremely elevated. 

5. There are fewer variable mortgages than in previous years

One thing which does help prop house prices up is that variable mortgages are not as prevalent as they have been previously, such as in the last housing crash in 2008.

The chart below, via the Financial Times, shows the comparison with 2014 for various countries. 

6. Housing affordability fell 29% in 2022 in the US

In the US, looking at the housing affordability index, affordability plummeted 29% in 2022 alone. This is a reflection of the house of living crisis grasping both the US and nations worldwide. 

7. US population has grown 67% in 55 years…housing supply has not

Comparing the monthly supply of new houses to US population growth explains a big part of the problem. While the population has jumped from under 200 million to 330 million today, the chart below shows that the monthly supply of new houses (the ratio of new houses for sale compared to new houses sold) has come nowhere near to matching this growth. 

8. US house prices jumped 40% during the pandemic 

Looking at the median sales price of US houses during the pandemic, prices increased 40% between Q2 of 2020 and Q3 of 2022. 

9. House prices have jumped 16X in 50 years

The median sale price of a home in the US was $29,200 in Q4 of 1972. 

Fast forward half a century to Q4 of 2022, and the median sales price was $468,000, a cool 16X greater. 

Source: FRED

10. US house prices fell last quarter for the first time since the pandemic struck

The pandemic-fuelled gains may be over, however. The median house price in the US ticked slightly down last quarter, coming in 0.1% below Q3 of 2022. 

While this decrease is marginal, it reflects the first time house prices fell since the panic of April 2020, when the COVID pandemic suddenly struck the world and markets panicked across the board. 

Source: FRED

11. On a monthly basis, US house prices have fallen for five months in a row

While the size of the declines is small, on a monthly basis, US house prices fell for the fifth month in a row in November 2022, per data released by the Federal Housing Finance Agency this month. Prices were down an additional 0.1% compared to October. 

Source: CNN

12. US house prices rose 17% in 2021, the greatest since at least the 60s

We have sales data back to 1963, and the 17% median house price rise in 2021 is greater than any year on record in this timeframe – 2021 saw a 12% rise and 2021 a 5% rise, with the COVID period overall seeing a 40% jump. 

Source: FRED

13. Hong Kong is the most expensive housing market in the world

The average price of a home in Hong Kong is HK$10 million, which equates to $1.3 million. That makes it the most expensive market in the world. 

Source: Loveproperty

14. The average rent in Manhattan is over $5,000 per month

For the first time ever, the average rent in Manhattan crossed the $5,000 mark last summer. Even the median was over $4,000 per month and had increased 25% from the previous year. 

Source: CNBC

15. In London, UK, private rental prices rose 4.3% in the last year

London is often criticised for being among the worst housing markets in Europe. The data backs that up as, even in 2022, rental prices rose 4.3% compared to 12 months previously. 

Source: Office for National Statistics

16. The average price of a UK house fell 0.4% in December

The most recent UK House Price Index shows prices fell by 0.4% in December 2022. Despite this fall, they remain 9.8% more expensive than one year previously.

Source: gov.uk 

17. The most expensive home in the US was sold for $238 million

The (unfurnished) top four floors of 220 Central Park South in Manhattan sold for $238 million in 2019. This makes it the most expensive home in US history, sold to hedge fund manager Ken Griffin. 

Source: New York Post

18. The world’s most expensive home sold for $361 million in Hong Kong

The most expensive home ever sold is in Hong Kong. Billionaire Yeung Kin-man is the founder and president of Biel Crystal a closely-held supplier of mobile phone touch screens. He purchased the property for $361 million in 2017. It was originally styled as an entire apartment block but was purchased by Yeung with views of becoming one very large abode. 

Source: mansionglobal.com

19. The worst house crash in US history was 2008, when homes fell 29% 

The Great Financial Crisis of 2008 was the steepest and quickest housing crash in memory. The median house price fell 29% from July 2006 to January 2009. That’s a far cry from the 0.1% decline last quarter. 

Source: demographia.com

20. 65.9% of homes in the US are occupied by owners 

In the US, close to two-thirds of homes are occupied by owners. This is the highest figure since 2011. 

Source: census.gov

21. More than one in three Americans who have owned a home say their parents helped financially

It has never been harder to own a home. Perhaps a YouGov poll from 2022 sums this up best. Among those who have managed the feat, 35% say they were helped financially by their parents in some way. 
Source: YouGov