Housing Market Stabilization Best in 18 Years

National Association of Home Builders/Wells Fargo Housing Opportunity Index (HOI) released record-high levels of housing affordability, the highest level since first being compiled 18 years ago. Oddly, the latest housing news is usually about the nation's high foreclosure rates, but the combination of the sliding house prices and favorable mortgage rates are apparently creating a more stable housing market.

According to the Home Builders Index, 70.8 percent of homes that were sold in the last quarter of 2009 were sold at an affordable price for families that earned an annual income of $64,000. “With interest rates still hovering at low levels and the economy beginning to rebound, the federal housing tax credit will encourage even more first-time and repeat home buyers to enter the market and help further stabilize housing and the economy by creating new jobs, stimulating home sales and reducing foreclosures," stated Bob Jones, NAHB Chairman and a home builder from Bloomfield Hills, Michigan.

For 4 and a half years, Indianapolis has shown to be in the market lead for affordable housing, with more than 95 percent homes sold to families with a median income of $68,100. Other states revealing high affordable sales in the U.S. housing market were Michigan and Ohio. How do these statistics compare to all of the other news happening in today's real estate market?

For example, foreclosures are still up 30 percent from last year despite the now, 1-year-old government creation, Home Afffordable Modification Program. The latest press release from the U.S. Department of Treasury states enthusiastically, that the program is working, but technically, it has only "permanently" worked for 116,000 people in foreclosure trouble.

Other related news is questioning whether it's a good thing to have high sales of affordable housing, but also continue to have really high foreclosure rates. Perhaps this is all a result of the economic crisis and job losses, but will these two significant factors in our society eventually even out?

The government recently put some added pressure on Bank of America, whose bailout money was in the billions, to encourage them to give out more loans and participate more in the loan modification program. So far, Bank of America is the now leading servicer in the HAMP.

Source: National Association of Home Builders

Written by Amy Munday
Huliq.com