The National Association of Realtors‘ affordability index broke the 200 mark for the first time ever, rising to 206.1 in January.
NAR President Moe Veissi said the breakthrough means a typical family has roughly double the income needed to purchase a median-priced home.
“For buyers who can qualify for a mortgage, now is a very good time to become a homeowner,” he said.
The index is based on the relationship between median home price, median family income and average mortgage interest rate. A score of 100 is defined as the point where a median-income household has exactly enough income to qualify for the purchase of a median-priced, existing single-family home.
Considering the likelihood that interest rates and home prices will change little in the near future, NAR projects its affordability index to remain at elevated levels throughout 2012.
