Housing Afforability and Pricing
Week after week as of late, economic signs are pointing to recovery in our real estate market.
Overall, the ecomony as a whole isn’t looking quite as good in that hundreds of thousands of jobs are still being lost every month across the United States – federal reserve board Chairman, Ben Bernanke, says the unemployment rate is likely to rise a little bit more before the economy diggs its way outl ater this year.
But for housing, most of the key indicators continue to point up..here’s the rundown:
- Pending home sales took a 3.2% jump last month, 2nd straight month of positive growth, these are signed home sale contracts that are scheduled to close in the next 30-90 days.
- Dr. Lawrence Yun, Chief Economist for the National Association of Realtors NAR says “we’re at the leading edge of the first time buyers responding to the very favorable affordability conditions, and the $8,000 tax credit.”
- Additionally, mortgage applications for future home purchases have also urged once again up 5% nationwide last month according to the Mortgage Bankers Association.
- Mortgage rates are firming up in response to the rising demand of mortgage money. They rose last week on average to 4.8% on a 30 year and 4.6 on the 15 year variety. Still, they are close to all time lows but with more people jumping into this home buying market, they could easily jump up over the 5% level in the coming weeks.
- According to the National Assocaiation of Home Builders NAHB, the affordibilty index also continues to hover near its all time best. According to NAHB, the median income american family earning $61,000 can now afford to buy a $290,000 home with a 20% down payment assuming only 25% on the gross income is devoted to the mortgage principle and interest, thanks to low financing rates.
- The median single family residence SFR now sells for about $175,000 and consumer psychology is turning upon housing, good for sellers!
The Gallup Polling Organizations asked a national sample of americans last month whether it is a good time to buy a house:
- Last month, 71% of americans polled said now is a good time to buy a house.
- 18% more than last year, and the highest level in four years
Moral of this post; only the doom sayers still believe housing isn’t turning around and heading for recovery!!
