Fewer can pay Valley home price
Fewer can pay Valley home price
Glen Creno and Catherine Reagor Burrough
The Arizona Republic
Nov. 11, 2004 12:00 AM
It's harder now for Valley residents to afford a home than any time since 1989.
The latest reading on a key housing affordability index published by Arizona State University hit its lowest level in 15 years. That's the result of a supercharged resale housing market that set another record for median price at $180,000 in October.
Rising values are good news for sellers but not for buyers, especially first-timers who can be knocked out of the market by the extra $10 or $20 a month that the rising prices can tack on to a mortgage. Median household income in the Valley is $52,000 and an ASU official said he was particularly worried about where the Phoenix market stands on the affordability scale. advertisement
"Home prices have climbed $30,000 in the past year, but you don't see the same runup in incomes," said Jay Butler, director of the Arizona Real Estate Center at ASU. "Something's gotta give because interest rates are bound to start rising."
The median price is up 16.8 percent from $154,000 in the same month last year. It's also a notch higher than the last record of $179,500 set in September, one of a number of records set this year as buyers and speculators swarm the housing market.
The index measures whether a typical buyer can afford a median-priced house at the prevailing interest rates. An index value of 100 or higher means typical buyers probably can swing a house deal.
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Glen Creno and Catherine Reagor Burrough
The Arizona Republic
Nov. 11, 2004 12:00 AM
It's harder now for Valley residents to afford a home than any time since 1989.
The latest reading on a key housing affordability index published by Arizona State University hit its lowest level in 15 years. That's the result of a supercharged resale housing market that set another record for median price at $180,000 in October.
Rising values are good news for sellers but not for buyers, especially first-timers who can be knocked out of the market by the extra $10 or $20 a month that the rising prices can tack on to a mortgage. Median household income in the Valley is $52,000 and an ASU official said he was particularly worried about where the Phoenix market stands on the affordability scale. advertisement
"Home prices have climbed $30,000 in the past year, but you don't see the same runup in incomes," said Jay Butler, director of the Arizona Real Estate Center at ASU. "Something's gotta give because interest rates are bound to start rising."
The median price is up 16.8 percent from $154,000 in the same month last year. It's also a notch higher than the last record of $179,500 set in September, one of a number of records set this year as buyers and speculators swarm the housing market.
The index measures whether a typical buyer can afford a median-priced house at the prevailing interest rates. An index value of 100 or higher means typical buyers probably can swing a house deal.
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