Rock Bottom Housing Prices or Simply Math Gone Wild
May 20, 2008 5:09 pm
OK, I have a question… (seriously) The idea that home prices are now at “rock-bottom” prices has been floating around lately. How is the NAHB coming up with their conclusions? In particular, do they include the sales price of short-sales? How about foreclosures?
If so, then is the average price really as low as it is going to go? If you can provide the details, I would be most appreciative.
As a result, 53.8% of all new and existing homes sold nationwide during the first three months of 2008 were affordable to families earning the median household income of $61,500, according to the latest Housing Opportunity Index released Tuesday by Wells Fargo and the National Association of Home Builders (NAHB).
That’s up from 44% during the first three months of 2007 with home prices the most affordable they’ve been since the three month period that ended June 30, 2004.
“Three factors combined to substantially increase housing affordability,” said NAHB president, Sandy Dunn, in a press release accompanying the report. “Mortgage rates returning to near the record low levels of a few years ago, a $2,500 rise in family income nationwide (from 2007 to 2008) and lower house prices…