The National Association of Realtors recently released a report on homes affordability in America, concluding that home buying is at its most affordable level in over 20 years. The report, called the Housing Affordability Index, compared the national median income ($65,000) to the median single-family home price ($158,000) and determined that this relationship between the two was at it’s most favorable mark since the Index’s inception in 1970.
The National Association of Home Builders also released a report this week stating that 78% of homes sold during the first 3 months of 2012 were affordable to families earning the national median income.
So what specifically is making homes so affordable to the average American family? Low home prices and record low interest rates. In the last few years we’ve seen home prices dip over 35% from their highs, while interest rates continue to set record lows. The latest average on the 30-year fixed interest rate is 3.79%. This perfect storm of affordable prices and record low interest rates is both an amazing and rare opportunity for buyers.