Where In The U.S. Homes Are Most Affordable

Matt Woolsey, 02.19.09, 04:00 PM EST

Getting Housing Back on Track

Though many are focused on sheer price measures, it's affordability--prices that are in line with income levels--that's key to enticing new buyers and strengthening the housing market. Based on historical trends, housing hasn't been this affordable since 2003, according to the NAHB, thanks in large part to the deterioration of housing prices to that year's levels.

Also expected to help: 50-year-low mortgage rates and the $8,000 tax credit for qualified first-time home buyers. Even so, with national prices down 12.5% last year (according to the NAR), a difficult credit market and the disintegration of mortgage securitization, the supply of buyers and banks to lend them money has been constrained.

"Falling home prices and very favorable mortgage rates both contributed to the housing affordability gains we saw in the fourth quarter of 2008," says Joe Robson, NAHB chairman. "However, at the same time, worsening economic conditions, historically low consumer confidence and uncertainty about future home prices kept many qualified buyers on the sidelines."

For more on this article: http://www.forbes.com/2009/02/19/cities-affordable-ten-lifestyle-real-estate_cities.html

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Johnny Crosby says...
on 02/20/09

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The problem we're facing (especially in Charleston) is the fact that home sales are competing with bank owned properties in just about every neighborhood. I think the NewCon Groups focus in new developments works well because in a new development there aren't any bank owned properties to compete with when purchasing. So that means appraisals come back "good", and that means in 2-3 years if you want to sell your house, the likely hood of competing with a bank owned property is highly unlikely in a new neighborhood.

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