Housing Affordabilty Remains High in April
The National Association of Realtors released its latest report today on the Housing Affordability Index (HAI) for April, showing a slight decline to 129.4 from the March level of 130 (see chart above) due to a slight increase in median-price home in April. A composite HAI of 129.4 means that a family earning the median family income in April ($60,185) had 129.4%% of the income necessary to qualify for a conventional loan (at 6.03%) covering 80% of a median-priced existing single-family home in April ($200,700).
Since July 2007 when the HAI was at only 103.6 (due to higher home prices and interest rates, $228,500 and 6.8% respectively), the 25.8 point increase in housing affordabilty to 129.4 in April should continue to play an important role in the recovery process for the slumping real estate market. It's a buyer's market.
2 Comments:
Mark, like your post. Would be very interested to see historical data for the HAI. How far back does that data go? How does it compare with the late 70s/early 80s when mortgage rates skyrocketed??
In 2006 the median household income was $48,201 according to the Census Bureau. Where did the NAR get $60,185?
OK, looking at the report to which you (Mark) linked: NAR reports 2006 median household income to be $57,612.
That's a big discrepancy from was the census bureau reports!
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