With home prices decreasing and interest rates holding at historically low levels, the number of potential home buyers nationwide and in the Boise City-Nampa MSA who can afford to buy new and existing homes has reached the highest level in more than four years, according to the National Association of Home Builders/Wells Fargo Housing Opportunity Index (HOI) released on November 17, 2008.
According to the third-quarter HOI readings, 56.1 percent of all new and existing homes that were sold nationwide were affordable to families earning the national median income of $61,500, far more than the 40.4 percent of families who could afford homes at the peak of the housing boom in the third-quarter of 2006.
In the Boise City-Nampa MSA, 58.6 percent of all new and existing homes that were sold were affordable to families earning the Boise City-Nampa MSA median income of $60,900, 2.5 percent higher than the national average. The 58.6 percent HOI reading for the Boise City-Nampa MSA is 15.74 percent higher than our lowest reading of 40.36 percent in the third-quarter of 2006. It also represents an increase of 14.1 percent increase over the 42 percent reading in the third-quarter 2007.
“If there is a silver lining to this crisis, it would be that some housing markets have become more affordable with a larger inventory to choose from,” said NAHB Chairman Sandy Dunn, a home builder from Point Pleasant, W.Va. “But this is undeniably a crisis and Congress needs to act on housing stimulus to get the market moving again.”
The NAHB/Wells Fargo HOI is a measure of the percentage of homes sold in a given area that are affordable to families earning that area’s median income during a specific quarter. Prices of new and existing homes sold are collected from actual court records by First American Real Estate Solutions, a marketing company. Mortgage financing conditions incorporate interest rates on fixed- and adjustable-rate loans reported by the Federal Housing Finance Board.
The NAHB/Wells Fargo Housing Opportunity Index is strictly the product of NAHB Economics, and is not seen or influenced by any outside party prior to being released to the public.
Chuck Miller GMB CGB CGP MIRM CMP MCSP CSP
President / Builder – Chuck Miller Construction Inc.
(208) 229-2553
chuck@chuckmillerconstruction.com