CNN/Money 
CNNMoney.com
Personal Finance
graphic

Homes more affordable in 1Q
NAR says rising incomes, lower home prices and mortgage rates underpin affordability conditions.
May 3, 2004: 10:29 AM EDT

NEW YORK (CNN/Money) – Rising incomes, a slight pull-back in home prices and low mortgage interest rates boosted housing affordability conditions in the first-quarter, an industry trade group said Monday.

"Although mortgage interest rates have risen in the last month, housing affordability conditions remain favorable," said David Lereah, chief economist for the National Association of Realtors.

YOUR E-MAIL ALERTS
Real Estate
Mortgages
Loan Markets
Interest Rates

"There are some challenges in the more expensive markets, but on balance most of households in the United States can readily afford a typical home."

NAR's composite Housing Affordability Index rose to 144.1 during the first-quarter from 138.7 the previous quarter, but dipped slightly from a year-earlier level of 144.9. Any score above 100 means generally favorable conditions exist.

The index measures affordability for all homebuyers making a 20 percent down payment, with an index of 100 defined as the level where a median-income family, earning $54,517, has the exact amount of income needed to purchase a median-priced existing home. The median existing home price is $170,800.

The Federal Housing Finance Board says the average mortgage interest rate for existing homes was 5.64 percent during the quarter, down from 5.83 in the previous quarter and 5.90 percent during the year-earlier period. These figures do not account for the recent rise in interest rates.

Mortgage Rates
30 yr fixed mtg 5.03%
15 yr fixed mtg 4.53%
30 yr fixed jumbo mtg 5.86%
5/1 ARM 4.06%
5/1 jumbo ARM 4.67%

Find personalized rates:
 

Rates provided by Bankrate.com.

The First-Time Homebuyer Affordability Index shows a typical first-time buyer household—those aged 25 to 44 with an annual income of $30,980—had 83.4 percent of the income needed to purchase a typical starter home with a 10 percent down payment. First-time buyers could afford a home costing $121,100 but the median price was $145,200.

"Although it's usually a challenge to buy your first home, there are more state and local programs today that are targeted to help entry-level buyers," Walt McDonald, NAR president and broker-owner of Walt McDonald Real Estate, said.  Top of page




  More on PERSONAL FINANCE
Best gifts for the outdoorsy type
Best gifts for the foodie
A brief introduction to bond investing
  TODAY'S TOP STORIES
Holiday gift guide
CNN.com: Senate to vote on health care debate
Senate tax hike misses the mark




graphic graphic

© 2009 Cable News Network. A Time Warner Company. All Rights Reserved. Terms under which this service is provided to you. Privacy Policy
Copyright © 2009 BigCharts.com Inc. All rights reserved. Please see our Terms of Use.
MarketWatch, the MarketWatch logo, and BigCharts are registered trademarks of MarketWatch, Inc.
Intraday data provided by Interactive Data Real-Time Services and subject to the Terms of Use.
Intraday data is at least 20-minutes delayed. All times are ET.
Historical, current end-of-day data, and splits data provided by Interactive Data Pricing and Reference Data.
Fundamental data provided by Morningstar, Inc..
SEC Filings data provided by Edgar Online Inc..
Earnings data provided by FactSet CallStreet, LLC.