Homes are More Affordable in 44 out of 50 States
Buyer confidence and high demand remain strong in Westchester County while our local home inventory remains historically low. Purchasing a home is one of the largest financial decisions most will make in their lifetime. This blog’s main purpose is to help educate the consumer on the real estate process and to provide up-to-date information on our local market conditions.
Today I would like to talk to you about Home Affordability
With both home prices and mortgage rates increasing this year, many are concerned about a family’s ability to purchase a major part of the American Dream – its own home. However, if we compare housing affordability today to the average affordability prior to the housing boom and bust, we are in much better shape than most believe.
In Black Knight’s latest monthly Mortgage Monitor, they revealed that in the vast majority of the country, it is actually more affordable to purchase a home today than it was between 1995 to 2003 when looking at mortgage payments (determined by price and interest rate) as compared to incomes. Home prices are up compared to 1995-2003, but mortgage rates are still much lower now than at that time. Today, they stand at about 4.5%. Here are the average mortgage rates for each of the years mentioned:
- 1995 – 7.93%
- 1996 – 7.81%
- 1997 – 7.6%
- 1998 – 6.94%
- 1999 – 7.44%
- 2000 – 8.05%
- 2001 – 6.97%
- 2002 – 6.54%
- 2003 – 5.83%
On the other hand, wages have risen over the last twenty years.
Black Knight’s research revealed that, when comparing “the share of median income required to buy the median-priced home” today, to the average between 1995 to 2003, it is currently more affordable to purchase a home in 44 of 50 states.
Here is a state map of the percentage change in the price-to-payment ratio. Positive numbers indicate that it is less affordable to buy while negative numbers indicate that it is more affordable.
Whether you are moving up to the home of your dreams or purchasing your first house, it is a great time to buy when looking at historic affordability data.
To assure that you make the best possible decisions, it’s important that you have a knowledgeable agent on your side who is an expert in the local real estate market. Our goal is to provide you with as much information as needed to make well-informed decisions throughout your home purchase or home sale in Westchester County, New York.
To Search ALL Westchester County Real Estate Listings, visit www.Ragette.com
To reach Ralph, please call (or text) 914-202-1101 or send an email to Ralph@WestchesterHomeAdvisor.com