The National Association of Realtors reported that the Composite Index of Home Affordability declined 2.6% during April to 169.3 following two months of increase. The index remained down 2.4% versus 12-months earlier. During the last ten years, there has been a 62% correlation between the affordability index level and the y/y change in existing single-family home sales.

The median sales price of an existing home strengthened 5.0% (5.8% y/y) to the highest level in three months. The rise was partially offset by a decline in the average mortgage rate to 3.87%, the lowest level in nearly three years. On balance, principal & interest payments rose to $843, or 14.8% of median income. That compared to a low of 11.7% early in 2013.

The Housing Affordability Index equals 100 when median family income qualifies for an 80% mortgage on a median priced existing single-family home. A rising index indicates more buyers can afford to enter the home-buying market. Data on Home Affordability can be found in Haver's REALTOR database. Interest rate data can be found in the WEEKLY and DAILY databases.