“HOME OWNERSHIP INCREASINGLY AFFORDABLE” – NAHB

With housing affordability hitting near-record highs, now is the time to buy.

A combination of low interest rates and reasonable housing prices ensured that nationwide housing affordability lingered near record high levels for the third consecutive quarter, according to the National Association of Home Builders (NAHB)/ Wells Fargo Housing Opportunity Index (HOI) released Thursday.

“At a time when housing is at its most affordable, we applaud the recent actions taken by Congress and President Obama to stimulate housing by extending the federal tax credit beyond its November 30 deadline and expanding it to a wider group of eligible homebuyers,” said Joe Robson, NAHB chairman and home builder from Tulsa, Oklahoma. “With interest rates now lower than last quarter, the tax credit will encourage even more homebuyers to enter the market and help stabilize housing and the economy by creating new jobs, stimulating home sales, reducing foreclosures, cutting excess inventories, and stabilizing home prices.”

After reviewing all new and existing homes sold in the third quarter of 2009, the HOI showed that 70.1 percent were affordable to families earning the national median income of $64,000. While this showed a slight decrease from the 72.3 percent affordability rate during the second quarter of 2009, it was notably higher than the 56.1 percent during the same period last year.

Holding steady for 17 consecutive quarters, Indianapolis remained the most affordable major housing market. According to the HOI, almost 95 percent of homes in this area were considered affordable to households earning the area’s median income of $68,100.

While affordability in Indianapolis was impressive, five smaller housing markets earned even higher affordability scores. Kokomo, Indiana posted the highest score, with 96.7 percent of homes sold during the third quarter considered affordable. Springfield, Ohio; Bay City, Michigan; Mansfield, Ohio; and Elkhart-Goshen, Indiana rounded out the top five.

Some markets, though, saw extremely low affordability scores. According to the HOI, the nation’s least affordable major housing market during the third quarter of 2009 was New York-White Plains-Wayne, New York/New Jersey, resulting in the area’s sixth consecutive appearance at the bottom of the affordability list. Homes in this vicinity were only affordable to about 19 percent of median-income earning residents. The least affordable of the smaller metro housing markets during the third quarter was San Luis Obispo-Paso Robles, California.

By: Brittany Dunn