Good News to Buyers: Affordability Improves
Low interest rates are helping to boost housing affordability. Nearly 67 percent of new and existing homes sold between January and the end of March were affordable to families earning the U.S. median income of $65,800, according to the latest National Association of Home Builders/Wells Fargo Housing Opportunities Index.
Read more: Housing Affordability Hits 2 Extremes
The national median home price fell from $215,000 in the fourth quarter to $210,000 in the first quarter. Meanwhile, average mortgage rates dropped from 4.29 percent to 4.03 percent in that time period.
"Now is a great time for consumers to buy homes," says NAHB Chairman Tom Woods. "Both first-time and move-up buyers can take advantage of these favorable market conditions and start building their American Dream."
Indeed, more first-time home buyers are taking advantage of new programs that are allowing them to qualify for a mortgage with down payments as low as 3 percent, such as those now being backed by Fannie Mae and Freddie Mac.