Home Affordability in Today’s Economy Revealed
In terms of home affordability, now is definitely the best time to invest in a South Park NC home for sale based purely from an economic perspective. A report from Black Night Financial Services’ Monthly Mortgage Monitor discusses the topic.
2 Revelations from the Report:
- Average home values in the United States have increased by $13,500 since last year; however, they have retained close to the same low interest rates as last year, keeping principle and interest payments low.
- Home affordability still remains favorable compared to long-term historic norms.
The report explains:
“Even though the value of the average home in the U.S. increased by about $13,500 over the last year, thanks to declining interest rates it actually costs almost exactly the same in principal and interest each month to purchase as it did this time last year.
Even taking into account the fact that affordability can vary – sometimes significantly – across the country based upon the different rates of home price appreciation we’re seeing, that’s a pretty incredible balancing act between interest rates and home prices at the national level…
Right now, it takes 20 percent of the median monthly income to cover monthly payments on the median-priced home, which is well below historical norms.”
While this is good news, it’s important to note that the report also cautioned that home affordability will be affected by an increase in mortgage rates.
“A half-point increase in interest rates would be equivalent to a $17,000 jump in the average home price, and bring that ratio to 21.5 percent. This increase is still below historical norms, but puts more pressure on homebuyers.”
The home affordability of your dream property is still very much within your reach. If you’re thinking about buying, now is the perfect time to take action and make the most out of this positive outlook in the economy. Still not sure about buying? Be sure to read Buying A Home Is Now 36% Cheaper Than Renting to learn more.
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