Share
Everyone is aware that right now we're seeing the lowest mortgage rates in a generation or two. Everyone is probably also mindful of the bargain prices. Due to inflation over time, people’s income generally rises over time, though the average family income stopped growing in 2009. So how do these facts add up in relation to the budget devoted to housing payments for recent buyers? Well, a typical family with middle income would be devoting less than 15% of their pre-tax income on mortgage payments to buy a typical home in the U.S. Furthermore, a family buying a home today would lock-in a fixed monthly payment for the long haul if taking out a 30-year fixed rate mortgage. Prices of just about everything can be expected to rise, along with income, but not mortgage payments. It is no wonder why homebuyers of the past 2-3 years have been some of the most successful, with extremely low default rates.
Here are the graphs that you may want to share with your clients:
(1) Average mortgage rates
(2) Median home price
(3) Family income
(4) Mortgage payment to buy a median priced home with a 20 percent down
(5) Monthly mortgage payment in relation to income
Notice: The information on this page may not be current. The archive is a collection of content previously published on one or more NAR web properties. Archive pages are not updated and may no longer be accurate. Users must independently verify the accuracy and currency of the information found here. The National Association of REALTORS® disclaims all liability for any loss or injury resulting from the use of the information or data found on this page.
