House Affordability Holds Steady in Quarter
Washington, DC, Feb. 21, 2014 -- Slightly lower median home prices along with a small uptick in mortgage rates contributed to housing affordability holding steady in the fourth quarter, according to the National Association of Home Builders/Wells Fargo Housing Opportunity Index.
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In all, 64.7% of new and existing homes sold between the beginning of October and end of December were affordable to families earning the U.S. median income of $64,400, NAHB said.
That is virtually unchanged from the 64.5% of homes sold that were affordable to median-income earners in the third quarter.
Meanwhile, the national median home price dipped from $211,000 in the third quarter to $205,000 in the fourth quarter while average mortgage interest rates rose from 4.45% to 4.54% in the same period.
“Housing affordability is stabilizing at a time when pent-up demand and ongoing job growth are helping housing markets across the nation to gradually strengthen,” said NAHB Chairman Kevin Kelly.
“While this bodes well for housing in 2014, builders continue to face challenges, including tight credit for home buyers, inaccurate appraisals, and a shortage of workers and buildable lots.”