Today’s real estate market presents an unprecedented opportunity for homebuyers. With the combination of low mortgage rates and remarkably low property values, buying a house is within reach to more families than ever before.
In fact, according to the National Association of Realtors’ (NAR) Housing Affordability Index—which measures the capability of families to qualify for a mortgage loan on a typical home—housing affordability has reached its highest level since tracking began in 1970.
To help interpret the findings, an index rating of 100 means that a family earning median income has exactly enough means to qualify for a mortgage on a median-priced home, assuming a 20 percent downpayment on the property. The higher the index, the greater the household purchasing power. A rating below 100 indicates the median income family would need more than 50 percent of their income to afford a median-priced home based on housing price and mortgage rates.
Based on the relationship between median home price, median family income and average mortgage rates, the Housing Affordability Index rose to its record high of 206.1 in January 2012.
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 NAR President Moe Veissi. “For buyers who can qualify for a mortgage, now is a very good time to become a homeowner.”
The seasoned agents of Michael Saunders & Company welcome the opportunity to help you take advantage of this homebuyers market. Contact us today for the very best in Sarasota real estate.
Learn more about housing affordability HERE.