If you’re not utterly panic-stricken by the seemingly-endless parade of fearmongers in the news, you’re probably smart enough to live in my neck of the woods, and there’s a better chance you can actually afford it now:
The Housing Affordability Index composite level for December was 158.8. A composite H.A.I. value of 158.8 means that a family earning the median income has 158.8 percent of the income needed to qualify for a mortgage on a median-priced home. (In other words, a higher index number means housing is more affordable; a lower index number means housing is less affordable.) The index had fallen during most of the housing bubble, when it became more and more expensive to buy a home. But … December’s composite level was the highest the index has reached since the association began collecting this data in 1971.
And there’s nothing to be gained by playing along with OMG IT’S A DEPRESSION hype, either:
In troubled times, it makes sense to be prudent. But, while irrational exuberance is hazardous, so is irrational gloominess. Acting as if you’re destitute because slightly more people are experiencing bad times than were doing so a few months ago is not only bad for your own quality of life but contributes to a vicious cycle that slows down the recovery.
In the meantime, I’m keeping an eye on three houses within a block of my own, the least expensive of which can be had for $112,500 and which six years ago was worth about $70k.