A brief excerpt:
The following graph shows the year-over-year change in principal & interest (P&I) assuming a fixed loan amount since 1977. Currently P&I is up about 30% year-over-year for a fixed amount (this doesn’t take into account the change in house prices).
This is less than the 35% year-over-year increase average in June, but still up sharply.
If we include the increase in house prices, payments are up more than 50% year-over-year on the same home.
The bottom-line is the recent decline in mortgage rates will help at the margin, but the housing market will remain under pressure with mortgage rates at 5% (fewer sales, slowing house price growth).
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