A look back at housing’s best year in a decade

The year of 2016 in housing dataviz

Len Kiefer

2016-12-31

Be sure to follow me on Twitter @lenkiefer and read my blog at lenkiefer.com.

Introduction

The year is drawing to a close, and by many measures 2016 was the best year for housing in a decade. Back in May1 See: http://lenkiefer.com/chartbooks/may2016/index.html I shared some trends on housing markets in a document similar to this. Now that we have nearly a full year’s worth of data, let’s see how housing and mortgage markets did in 2016.

I’ve been tracking trends in the housing and mortgage market throughout the year, sharing many different data visualizations2 On my blog at http://lenkiefer.com I have shared R2 code for most of the visualizations you’ll see in this post. Check back there for more updates in future. Let’s look back on this year’s best data visualizations and what they tell us about key trends.

Mortgage rates

If you’ve been following me, I’ve spent a lot of time talking about mortgage rates. Just about every week I produce a number of graphs showing trends in mortgage rates. Because most homebuyers use a mortgage3 According to the American Community Survey in 2015 about 63% of homeowners have a mortgage: https://factfinder.census.gov/bkmk/table/1.0/en/ACS/15_1YR/DP04., movements in mortgage rates have a significant impact on housing demand. Rising rates lower homebuyer affordability and price some prospective buyers out of the market.

Mortgage rates on 30-year fixed mortgages started the year at about 4%4 See http://www.freddiemac.com/pmms/pmms_archives.html for details and fell for most of the year. But starting in the fall and accelerating after the U.S. election on November 8th rates began to rise. As of the last week of 2016, 30-year mortgage rates averaged 4.32 percent.

The table below shows the history of monthly average 30-year fixed mortgage rates from 1971 through 2016, while in the margins I include several of my favorite visualizations for rates. You can read more about these figures, find more examples, and get sample code to create them here, here, and here.

Some of my favorite mortgage rate visualizations: