Industry Update: Now Is The Time To BuyPosted 08/20/2012
According to a recent survey by the National Association of Home Builders (NAHB) and Wells Fargo, nearly 74 percent of the new and existing homes sold between April and June were affordable to people who earn the national median income of $65,000. The bad news? That number is down from the record high of 77.5 percent recorded a quarter earlier.
Regardless, experts say, home affordability still is considered high by historical standards, even though prices are beginning to creep up. According to the survey, median home prices were up in 92 percent of the markets polled. Meanwhile, median income remained constant. While the decline in affordability may be bad news for consumers, experts view it from a slightly different perspective, calling the pricing uptick a positive sign for the market.
“(It’s) another signal that the housing recovery is starting to take root and lends needed confidence to prospective buyers and sellers who have been reluctant to move forward in the current marketplace,” said Barry Rutenberg, NAHB chairman and a home builder from Gainesville, Fla., in a prepared statement.
In other words, now is the time to buy!
The most affordable major housing market in the second quarter, according to the NAHB report, was Youngstown, Ohio, where 93.4 percent of homes sold during the survey period were affordable to households earning the area’s median family income of $55,700. Also ranking among the most affordable major housing markets in respective order were Dayton, Ohio; Buffalo-Niagara Falls, NY; Indianapolis-Carmel, Ind.; and Modesto, Calif.
Of the smaller housing markets, Fairbanks, Alaska, topped the affordability list, with 98.7 percent of homes sold during the second quarter being available to families earning the area’s median income of $92,000. Mansfield and Springfield, Ohio; Carson City, Nev.; and Kokomo, Ind., also were affordability leaders.
Meanwhile, at the other end of the spectrum, New York-White Plains-Wayne, N.Y-N.J., retained the title of the least affordable major housing market in the nation for the 17th consecutive quarter. Fewer than 30 percent of the homes sold there in the last quarter were affordable to families earning the area’s median income of $68,300.
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