Due in large part to the persistent decline in mortgage rates throughout 2019, housing is now more affordable than it has been at any point in the last three years.

That’s according to a new analysis of the nation’s housing market from the National Association of Home Builders and Wells Fargo.

As the latest data from Freddie Mac, mortgage rates now sit at 3.69%, more than a full percentage point below where they were at this time last year, when the market rate was near 5% (4.94%, to be exact).

Rates stayed at the same level through the second week of November 2018, but that was as high as they climbed, as rates then began dropping and continued dropping throughout much of this year.

And that full-percentage-point-drop has been very good for homebuyers, as the National Association of Home Builders/Wells Fargo Housing Opportunity Index shows that housing affordability climbed in the third quarter to the highest level since 2016.

According to the report, 63.6% of new and existing homes sold between the beginning of July and end of September were affordable to families earning the U.S. median income of $75,500.

That’s up from the 60.9% of homes sold in the second quarter of 2019 that were affordable to median-income earners and up from the first quarter 2019 total of 62.6%.

As the report notes, much of the increase in affordability was driven by the decline in mortgage rates.

According to the report, average mortgage rates fell from 4.07% in the second quarter to 3.73% in the third quarter, falling to three-year lows in September.

Also contributing to the rise in affordability was static home prices.

According to the NAHB/Wells Fargo report, the national median home price remained at $280,000 in the third quarter, the same as it was in the previous quarter.

Combine those factors with a strong job market and it means that housing is easier for people to afford.

But it’s not all sunshine and roses, especially for first-time homebuyers, as recent data and analysis show that housing may be affordable, there simply isn’t enough of that affordable housing on the market to satisfy demand.

That’s a concern shared by the NAHB, a trade group that represents homebuilders.

“With mortgage rates at historic lows, consumers are experien

Read more: https://www.housingwire.com/articles/thanks-to-lower-mortgage-rates-housing-is-more-affordable-than-its-been-in-3-years/


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