Is Home Ownership Still Affordable?
It seems you can’t find a headline with the term “housing affordability” without the word “crisis” attached to it. That’s because some only consider the fact that residential real estate prices have continued to appreciate.
So, is Home Ownership still part of the American Dream?
I can see why people ask me that question. Because prices have continued to increase, but interest rates have decreased since December 2018 and income is at 3.5%. The National Association of Realtors indicates that only 16.5%is needed for their monthly payments. Historically that number has been 21.2%. The First Ameican Real Estate index indicates that with the lower interst rates we currently have that the affordability is higher than it has been in 20 years. You might be surprised to know that the incomes have increased 5% since January of 2000 and with our lower interst rates that means that affordability is 150% higher than January of 2000. So if you think that homes are no longer affordable, I think you'll be pleasantly surprised.