Data : Where You’ll Find The “Most Affordable Homes”

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If you're a home buyer, there's never been a better time to buy a home. Home affordability remains near all-time highs.

Home Affordability Peaked In March

According to the National Association of Home Builders, more than 72 percent of all homes sold last quarter were affordable to families earning the national median income of $64,200.

This figure is 2 ticks below the previous quarter's reading of 74 -- the all-time high for home affordability nationally.

Home affordability fell for three reasons last quarter.

1. Home prices are stabilizing and/or rising in many markets
2. The national median income slipped slightly
3. Mortgage rates were rising toward the end of Q2 2011

Affordability levels remain high, historically, however. For the 12th straight quarter, the Home Affordability Index surpassed 70. Prior to 2009, it rarely crossed 65.

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Cincinnati, Columbus And Dayton Remain Affordable

On a city-by-city basis, home affordability varied last quarter.

Kokomo, Indiana topped the national rankings; 95.8% of homes were affordable to households earning the median income there. A flurry of midwestern cities followed including Wheeling, WV; East Lansing, MI; and Youngstown, OH.

Cincinnati, Columbus, and Dayton handily beat the national average, as did other noteworthy mid-sized cities:

• Springfield, Illinois : 91.1
• Dayton, Ohio : 90.7 percent
• Cumberland, Maryland :  90.4 percent
• Winter Haven, FL : 90.0
• Cincinnati, Ohio : 83.9 percent
• Columbus, Ohio : 83.0 percent

On the opposite end of the affordability scale, the New York-White Plains, NY-Wayne, NJ region ranked last in home affordability for the 13th straight quarter.

Just 25% of homes there are affordable to families earning the local median income.

The rankings for all 225 metro areas are available online.

A Second Chance For A Highly Affordable Home?

Unfortunately, the Home Opportunity Index is dated. It ends with June 30, 2011 and, therefore, fails to capture the falling rates of the last 6 weeks.

In that time, mortgage rates have tumbled, making new all-time lows and driving the 5-year ARM below 3 percent, among other improvements. The drop in rates has done wonders for home affordability, lowering mortgage payments by as much as 4 percent monthly.

This puts more homes within reach of the American home buyer and it's true for all loan types including conventional, FHA, jumbo and USDA.

It's a tired cliche, but right now is a great time to buy a home.

Click here to get a mortgage rate quote.