Housing affordability gets a boost
Thanks to declining mortgage rates, Americans are now seeing one of the lowest payment-to-income ratios in years. And in early September? Housing affordability actually hit a 32-month high, according to new data.Verify your new rate (Sep 28th, 2020)
September was a good month for homebuyers. According to data from Black Knight, the monthly mortgage payment-to-income ratio dropped to 20.7 percent — its second-lowest point in 20 months. In one week, it dropped as low as 20.3%, marking a 32-month high in terms of housing affordability.
All in all, the average payment sits at $1,122 — down 10 percent since November 2018, when interest rates hit their highest point in years.
According to Black Knight’s Mortgage Monitor report, “The decline in rates since then has been enough to boost buying power by $46K while keeping monthly P&I payments the same.”
Where housing affordability is highest
Payment-to-income ratios are lowest in Ohio. In fact, of the top 10 most affordable markets, half are in the Buckeye State.
Dayton is No. 1 with a 12.6 percent payment-to-income ratio, followed by Akron and Youngstown. Scranton, Pennsylvania also makes the list with a 13 percent payment-to-income ratio, while Toledo rounds out the top five with 13.2 percent.
On the other end of the spectrum is Los Angeles, where the payment-to-income ratio clocks in at a whopping 42.9 percent. Other markets low on the affordability scale include San Jose, San Francisco, San Diego, Honolulu, Seattle, and New York.Verify your new rate (Sep 28th, 2020)
Get today’s mortgage rates
Are you looking to take advantage of rising affordability in your market? Then shop around and see what mortgage rates you qualify for today.