May Bi-Monthly News-Part 1
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Bi-Monthly News
Pending Home Sales Rise,
Housing Affordability Near Record
Part 1 | May 2009
In this
Issue:
page 2
Legal Corner
page 3
May Birthdays &
Company Anniversaries
page 4
Super TIP!
Helpful TIPS
page 5
Up-Coming Events
Pending...
[More]
Bi-Monthly News
Pending Home Sales Rise,
Housing Affordability Near Record
Part 1 | May 2009
In this
Issue:
page 2
Legal Corner
page 3
May Birthdays &
Company Anniversaries
page 4
Super TIP!
Helpful TIPS
page 5
Up-Coming Events
Pending home sales rose with many first-time
buyers taking advantage of historically good housing
affordability conditions, according to the NAR®
.
The Pending Home Sales Index, an indicator based
on contracts signed in March, increased 3.
2 percent
to 84.
6 from a level of 82.
0 in February, and is 1.
1
percent higher than March 2008 when it was 83.
7.
Lawrence Yun, NAR®
chief economist, said it should
take a few months for the market to gain momentum.
“This increase could be the leading edge of first-time
buyers responding to very favorable affordability
conditions and an $8,000 tax credit, which increases
buying power even more in areas where special
programs allow buyers to use it as a downpayment,”
he said.
“We need several months of sustained
growth to demonstrate a recovery in housing,
which is necessary for the overall economy to turn
around.
”
NAR®
’s Housing Affordability Index remained near
record highs.
The affordability index was 166.
7
in March – down from an upwardly revised record
of 174.
4 in February due to higher home prices in
March.
The index remains 30.
8 percentage points
higher than a year ago.
The HAI is a broad measure
of housing affordability using consistent values
and assumptions over time, which examines the
relationship between home prices, mortgage interest
rates and family income; tracking began in 1970.
The Pending Home Sales Index in the South rose 8.
5
percent to 93.
2 in March and is 7.
7 percent above a
year ago.
In the West the index increased 3.
9 percent
to 93.
1 and is 1.
7 percent higher than March 2008.
The index in the Northeast fell 5.
7 percent to 59.
5 in
March and is 24.
1 percent below a year ago.
In the
Midwest the index slipped 1.
0 percent to 82.
3 but is
8.
2 percent higher than March 2008.
NAR President Charles McMillan, a broker with
Coldwell Banker Residential Brokerage in DallasFort Worth, said the increase in buying power is
quite remarkable.
“Compared to a year ago, the
typical family can pay much less in mortgage costs
for the same home, or buy a better home without
necessarily increasing their monthly payment,”
he said.
“For buyers who’ve been on the sidelines
and have good jobs, the market has never looked
more favorable.
Homeownership has always offered
immediate benefits and long-term value, but the
advantages in today’s market are unique.
”
A median-income family, earning $61,100, could
afford a home costing $291,600 in March with a 20
percent downpayment, assuming 25 percent of gross
income is devoted to mortgage principal and interest.
Affordability conditions for first-time buyers with the
same income and small downpayments are roughly
80 percent of that amount.
The affordable price was
notably higher than the median existing single-family
home price in March, which was $174,900.
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