Graphs and numbers from housing sales reports, part 1. In this lesson, we're going to review some graphs and a few paragraphs from the article, Orange County Housing Report: Low Rates Prop Up Affordability from June 2021. The author of this article, Stephen Thomas, uses many vocabulary words that explain numbers and trends and graphs and charts. Let's start by looking at some vocabulary that you will want to understand as you analyze graphs and charts in reports. First, here are some words that express rates or numbers going up. Increase, soar, go up, rise, rose, risen, raise, spring, high, higher, highest, height, top, peak, summit. We have some words showing going down or rates, numbers going down, decrease, plummet, go down, fall, felt, fallen, decline, drop, low, depth, bottom, rock bottom, in the basement. Unchanged ideas remain steady, remain the same, stay the same, level off, at the same rate, at the same level, flatline, unchanged. Also some adjectives and adverbs you should be familiar with when reporting numbers. You can look those up on your own. I'm not going to read through those. How could we describe the information in this line graph? Notice first the blue line that starts at the number 25 on the left. This line represents the numbers of houses sold in region 1. In April, 25 houses were sold, in May, 30, June, 70, and July, 100. Think of some sentences how you might be able to describe this blue line. Here's one possibility. Sales went up slowly in region 1 in May. Sales went up in region 1 from 30-70 houses in June. That's more than double. Sales steadily rose from May to July in region 1. Housing sales reached their peak in July in region 1. Now let's look at the green line that starts at the number 75 on the left. This line represents the numbers of houses sold in region 2. In April, 75 houses were sold, in May, 65, June only 10, and July zero. Here's a first example sentence. From April to July, sales declined in region 2. This is a little bit different. Can you think of some other sentences? Sales gradually decreased from April to May in region 2. Sales dropped sharply between May and June in region 2, sales hit rock bottom in July in region 2. Of course, there are many different ways you can write sentences, or you might hear sentences with these numbers. But here, these are some examples for you. As I mentioned before this presentation lesson uses information from the article Orange County Housing Report : Low Rates Prop Up Affordability, we will carefully go over some of the sections and graphs from the report. If you would like to read the full report from June 2021, you will find it with this module. Let's look at the first paragraph. In 1980, a new car cost around $7,200 and a gallon of gas was $1.19. It was 2.25 for a movie ticket, 15 cents for a first class stamp, 91 cents for a dozen eggs and 2.16 for a gallon of milk. It was cheap living back in 1980. Reminiscing and longing for the good old days leaves out a very important, often overlooked difference income. The Orange County median household income in 1980 was $22,000 a drop in the bucket compared to today's $100,000 level. Let's look at some of the vocabulary that might be new for some of you. First that word reminiscing, this refers to remembering fondly thinking back at the good old days, for example, the drop in a bucket is an expression. It means a small amount of one thing as compared to another. This is the idea of the bucket of water. If you have one drop in the bucket of water, it's not very much in comparison. We're going to go ahead to find out more about mortgage rates and why they're important and this is in paragraph 2 from our article. It boils down to perspective, looking only at housing prices, tells only part of the story. It is important to also consider household incomes and the prevailing mortgage rates. Naysayers are quick to point out how the median sales price was much lower back in prior years. However, taking into consideration both the median income and the average 30 year mortgage rate illustrates how buyers can afford so much more today. The historically low mortgage rate environment has stoked today's insatiable demand and has allowed housing to soar over the past year. Here we're going to also look at some vocabulary. First this idiom boils down to this means to get to the main point. This idiom comes from the process of boiling down sap from maple trees to make syrup. Now mortgage rate is something important if you don't know this word. This refers to the interest rate attached to a mortgage, which is another word for a loan for a house or other property. In the United States, the most common term for a home loan mortgage is 30 years, so 30 years of time to pay back. The word stoke means to add fuel to something burning and it can be literal, as in stoking a fire, or idiomatic as it is used here. Insatiable means it cannot be satisfied. Soar is to rise very high, as in an eagle soars high in the sky. Let's go ahead now with paragraph three and this is regarding affordability over time. To understand where this heightened demand and buyers exuberance is coming from, it is necessary to consider where interest rates and income have historically been and their impact on affordability. The chart below, we'll see in a minute, highlights how higher interest rates limit the price of a home that a buyer can afford. In 1980, the average mortgage rate was 13.75 percent. The median income was $22,000 and the median detached sales price was a $108,000. That meant that the monthly housing payment was 55 percent of a home owner's income. Rates continued to drop and incomes climbed decade after decade. In the year 2000, mortgage rates were at 8 percent, the median income grew to $56,000, and the median detached sales price had blossomed to $317,000. Yet the monthly payment was only 40 percent of homeowners income. It swelled to 59 percent in 2007, just prior to the start of the Great Recession and dropped to 33 percent in 2012 as housing began to climb once again. Flash forward to today's 2021s three percent mortgage rate, $101,000 median income, and a record setting April median detached sales price of $1,100,000 and the monthly housing payment is 44 percent of a homeowner's monthly paycheck. It's a lot of information there. I tried to color code it a bit so you could follow the years and then also look at the different parts in this paragraph. First, let's look at some vocabulary and then we'll see the chart with the information. Heightened, This is an adjective, it comes from high, so it means to make higher or in a higher condition. Exuberance is enthusiasm and excitement. Detached in this context refers to an individual stand-alone house and blossomed is something opened up like a flower from a bud. It can also mean matured. Here's the chart that we can see with the data from this paragraph. You see the monthly mortgage rates, excuse me, the average 30 year rate, the median detached sale price in the second column, the median income, and the payment as percent of income. Another way to look at the data from paragraph 3 and the chart on the previous slide is to use pie graphs to show the percentage of an average homeowner's income that was needed to cover the costs of mortgage payments for a detached home over the years given. Here, we are just focusing on that percentage. Here's paragraph number 3 again, we're not going to use all this information, but just a portion of it. Here we see in 1980, we have 55 percent of income was used to make the monthly payments for housing. That's the side in blue. There's the 55 percent. In the year 2000, 40 percent of income was used for housing payments. 2007, it was 59 percent. In 2012, 33 percent, and in 2021, 44 percent. Why was there so much change? This was something that fluctuated, it didn't always go up, but there was some going up increase of the percentage needed to make monthly payments and sometimes the percentage went down. Why did that happen? Well, income levels rose, that's true. Prices of houses went up, that's true too, if we look at all the data. But it was the mortgage rates that fluctuated and that's what is reflected in these percentages as well. It's an interesting way to look at some of this information. We need to look at everything, not just prices and costs, but some of the other relevant information. We only reviewed a few paragraphs of the article, Orange County Housing Report: Low Rates Prop Up Affordability. In this lesson of Graphs and Numbers Part 1, we will continue this with more of the article in the next lesson : Graphs and Numbers Part 2. Hopefully this lesson has given you some new ways or ideas of how to read and understand graphs and numbers in reports, as well as how to express them in your speaking and writing. Be sure to complete the practice activity that goes with this lesson.
