REAL ESTATE AND MORTGAGE NEWS
Buyers Advice: Housing Affordability
by Carla L. Davis - Mon, May 24, 2010
According to the National Association of Home Builders (NAHB) and their Home Builders/Wells Fargo Housing Opportunity Index (HOI), affordability is high for the 5th consecutive quarter.
How is affordability calculated? In general terms, if housing costs don't exceed 30 percent of the monthly household income, then it meets the standards. Anything more than 35 percent is too high
“Today's report is very encouraging because it indicates that homeownership continues its more than year-long trend of remaining within reach of more households than it has for almost two decades,” said NAHB Chairman Bob Jones, a home builder from Bloomfield Hills, Mich. “With interest rates still hovering at low levels, companies starting to hire new employees and the economy beginning to rebound, this should encourage more home buyers to enter the market and help further stabilize housing and the economy.”