Both buyers and sellers in the Boise real estate market can be encouraged by the record breaking Housing Affordability Index numbers for 2012. According to the National Association or Realtor's (NAR), the index stood at 198.2 in November 2012, higher than any other year since record keeping began in 1970.
What is the Housing Affordability Index?
The Housing Affordability Index measures the relationship between the median home price, median family income, and the average mortgage interest rate. As stated by NAR, "a composite index of 100 is defined as the point where a median-income family household has exactly enough income to qualify for the purchase of a median-priced existing single-family home, assuming a 20 percent downpayment and 25 percent of gross income devoted to mortgage principal and interest payments." The higher the index, the greater the household purchasing power.
What does a record breaking Housing Affordability Index mean for the Boise real estate market and for me?
A high Housing Affordability Index is good news for the Boise real estate market and the local economy. For buyers, these favorable conditions are creating opportunities to realize home ownership at a much lower cost than in years past. And with the well priced homes available and record low mortgage interest rates, buyers who were unsure about getting into the Boise real estate market are now jumping off the fence. For sellers, high affordability leads to increased purchasing ability, which leads to increased buyer confidence, which leads to more willing and able buyers available to purchase your home.
Although projected to go down, the Housing Affordability Index should remain strong in 2013. This means there is still opportunity for buyers in the Boise real estate market to capitalize on these favorable conditions in the new year. Sellers, this also means you may just find more buyers competing for your home!
If you would like to find out more about the affordability of homes in Boise real estate market, please send me an email or call me at 208-861-5639. I would love to sit down with you to help determine if now is the right time for you and your family to make a move. Remember, just because a national index says its a good time to buy or sell, that doesn't always mean it is the right time for you. I'd be happy to help you explore your options and see where it leads.