Moving to a home most affordable in 40 years

A report has shed light on how affordable moving to a new home could be for the average American family.

Using August data on mortgages, home prices and personal incomes, Beacon Economics determined that the average family would need to put 16.9 percent of the income towards their monthly mortgage payments, assuming they had made a 20 percent down payment. That percentage was down from 17.1 percent in July and makes 21 straight months that its been below 20 percent. The report said that moving into a new home has been made possible for many families due to record-low mortgage rates and home prices that are down 25 percent from their peak.

"While prices may fluctuate modestly over the next several months, we believe the worst of the housing crisis is behind us," said Beacon Economics research manager Jordan Levine. "We expect prices to stabilize around current levels and likely be higher in the next twelve months."

The federal government recommends that in order for housing to be considered affordable, its costs should not amount to more than 30 percent of a household's income. Recent Census data revealed that judging by that standard, more than half of the country's renters in 2009 were living in apartments with rent prices that they could not afford.
 

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