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Residential home affordability at highest point ever

The National Association of Realtors recently released a report showing that housing affordability has increased to its highest level since the figure was first monitored more than 40 years ago.

The group's Housing Affordability Index increased to 206.1, which takes into consideration median home price, family incomes and the average mortgage interest rate.

"This is the first time the housing affordability index has broken the two hundred mark, meaning the typical family has roughly double the income needed to purchase a median-priced home," said Moe Veissi, president of NAR. "For buyers who can qualify for a mortgage, now is a very good time to become a homeowner."

In addition, the NAR noted that affordability will continue to be elevated throughout 2012, as both home prices and mortgage rates are not expected to show large increases, according to the report.

Continued affordability in the residential housing market may suggest that more consumers to get involved with lending. Furthermore, the latest housing scorecard from the Obama administration showed that many consumers already with mortgages have taken advantage of the refinance opportunities that have been driving origination volumes, as of late.


Posted on: Friday, March 09, 2012