HOW AFFORDABLE ARE HOMES?

 

The Home Affordability Index provides a measure of a worker’s ability to purchase a home. The index uses median home prices, derived from publicly recorded sales deed data collected by RealtyTrac, and average wage data from the U.S. Bureau of Labor Statistics in 456 U.S. counties with a combined population of 221 million. The affordability index is based on the percentage of average wages needed to make monthly house payments on a median-priced home with a 30-year fixed rate mortgage and a 3 percent down payment. This includes property taxes, home insurance, and mortgage insurance. Buyers and sellers may refer to this index to get a general idea of how home prices and other factors are trending from a national perspective.   

Before going forward with the purchase of real estate, it is critical to determine what percentage of your monthly income you can spend on your monthly housing bills. Being realistic is important. We will walk you through your transaction, step by step. We have a successful history of assisting buyers in your community. Contact us today to schedule an initial consultation at our conveniently located office.

HINT: When home prices were most affordable nationwide in the first quarter (Q1) of 2012, the average wage earner needed to spend 22.2% of monthly wages to buy a median-priced home. In Q2 2006, a wage earner spent 53.2% of monthly wages.