Housing Affordability Rises in First Quarter
Washington, DC, May 14, 2014 -- Slightly lower median home prices along with steady mortgage rates contributed to higher housing affordability in the first quarter, according to the National Association of Home Builders/Wells Fargo Housing Opportunity Index.
In all, 65.5% of new and existing homes sold between the beginning of January and end of March were affordable to families earning the U.S. median income of $63,900. This is slightly higher from the 64.7% of homes sold that were affordable to median-income earners in the fourth quarter.
Meanwhile, the national median home price dipped from $205,000 in the fourth quarter to $195,000 in the first quarter while average mortgage interest rates were virtually unchanged, moving from 4.54% to 4.57% in the same period.
“Housing affordability remains strong and this is an encouraging sign as the spring home building season moves into high gear,” said NAHB Chairman Kevin Kelly.
“As home prices and mortgage interest rates are unlikely to go down, the first quarter HOI is another indicator that this is an opportune time to buy,” said NAHB Chief Economist David Crowe.