The National Association of Realtors (NAR) recently released their July edition of the Housing Affordability Index. The index measures whether or not a typical family earns enough income to qualify for a mortgage loan on a typical home at the national level based on the most recent price and income data. NAR looks at the monthly mortgage payment (principal & interest) which is determined by the median sales price and mortgage interest rate at the time. With that information, NAR calculates the income necessary for a family to qualify for that mortgage amount (based on a 25% qualifying ratio for monthly housing expense to gross monthly income and a 20% down payment).
Here is a graph of the income needed to buy a median priced home in the country over the last several years:
And the income requirement has accelerated even more dramatically this year as prices have risen:
Some buyers may be waiting to save up a larger down payment. Others may be waiting for a promotion and more money. Just realize that, while you are waiting, the requirements are also changing.
Author:Rachel Jama Phone: 817-909-4414 Dated: September 16th 2015 Views: 1,204 About Rachel: Rachel was born in Fort Worth and grew up in the Hurst, Euless, Bedford area. After graduating high ...
As the cold north winds blow and snow accumulates on the lan
"Stop filtering through realtor referrals in the DFW area and call Erin immediately. After being let down by another referral I did what I should have done the first time and called Erin. She was professional, organized and a great negotiator in my housing search when I moved to town. I will use her services again hands down.