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Housing Reaches Most Affordable Level in 18 Years
The NAHB/Wells Fargo Housing Opportunity Index (HOI) jumped 10 points during this year’s first quarter, indicating that housing affordability had reached its highest level since the series began 18 years ago.
According to the HOI, 72.5% of all new and existing homes sold in the first three months of 2009 were affordable to families earning the national median income of $64,000, up from 62.4% during the prior quarter and 53.8% during the same period a year earlier.
“Underlying the increase in affordability are lower home prices and record low interest rates,” said NAHB Chairman Joe Robson. “Combined with the $8,000 federal tax credit for first-time home buyers, consumers are beginning to return to the marketplace.”
In Indianapolis — the most affordable major housing market in the country during the first quarter — almost 95% of all homes sold were affordable to households earning the area’s median family income of $68,100. Indianapolis has now been at the top of the affordability list for 15 consecutive quarters.
Also among the most affordable major metro housing markets were Youngstown-Warren-Boardman, Ohio-Pa.; Akron, Ohio; Grand Rapids-Wyoming, Mich.; and Syracuse, N.Y.
Several smaller housing markets posted even higher affordability scores than Indianapolis. Outscoring them all was Sandusky, Ohio, where nearly 98% of the homes sold during the first quarter of 2009 were affordable to median-income earners. Other small housing markets even more affordable than Indianapolis included Monroe, Mich. and Mansfield, Springfield and Canton-Massillon, Ohio.
New York-White Plains-Wayne, N.Y.-N.J. — where just over 21% of all homes sold in this year’s first quarter were affordable to those earning the area’s median income of $64,800 — was once again the nation’s least affordable major housing market, despite a seven percentage point improvement in affordability. New York has been the least affordable major metro market for four consecutive quarters.
Other major metros at the bottom of the affordability chart included San Francisco; Los Angeles-Long Beach-Glendale, Calif.; Nassau-Suffolk, N.Y.; and Honolulu.
Among smaller metro areas, Ocean City, N.J. was the least affordable market, along with San Luis Obispo-Paso Robles, Calif.; Flagstaff, Ariz.; Hanford-Corcoran, Calif.; and Santa Cruz-Watsonville, Calif., respectively.
 Tax Credit Web Site Looks at Opportunity of a Lifetime
Builders and other industry professionals can help spur home sales by referring prospective first-time home buyers to www.federalhousingtaxcredit.com. The NAHB Web site provides detailed information on the $8,000 federal tax credit for first-time home buyers included in the economic stimulus legislation signed into law by President Obama.
Consumers can use the Web site to find information on the tax credit — including a detailed question and answer section. It also includes information about other housing-related and small business measures in the legislation and a number of home-buying resources for consumers.
Spanish Version Also Available Online
A Spanish version of this increasingly popular Web site is also available to provide detailed information on the tax credit to Spanish-speaking first-time home buyers.
Industry professionals are encouraged to highlight either tax credit Web site when marketing to their potential first-time home buyer market.
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To learn more, visit www.housingeconomics.com.
 Free NAHB Kit Gives Builders Back-to-Basics Tips to Navigate the Slowdown
What was once expected to be a relatively mild housing slump following three years of record new home construction and sales has given way to a significant downturn.
To help members navigate the uncharted waters of this slowdown, NAHB has compiled a comprehensive “Back to Basics” online toolkit — the best of the basics, the tried and true and the truly new. To access the toolkit, click here.
To access the “Back to Basics” toolkit, you must be an NAHB member and have a login to www.nahb.org. To create a login, go to www.nahb.org/login or click on the log-in button on the main menu bar.
For assistance, call the NAHB Member Service
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