NAR releases its housing affordability index

Today, NAR announced that

NAR’s composite Housing Affordability Index
was 131.8 during the fourth quarter of 2004, up 2.9 percentage points from 128.9
in the third quarter, and 5.0 points below the same period a year earlier, when
it stood at 136.8.

The
index shows the nation’s typical household had 131.8 percent of the income
needed to purchase a home at the fourth quarter median existing-home price,
which was $187,500. This index measures affordability factors for all homebuyers
making a 20 percent downpayment, with an index of 100 defined as the point where
a median-income family has the exact amount of income needed to purchase a
median-priced existing home. The fourth-quarter median family income was
projected to be $55,239.

What
does this mean? It means that
nationwide,
most people can afford a median-priced house. As they say, all real estate is
local.

(Visited 6 times, 1 visits today)