According to the latest Legislative and Political Forum held at the
Realtors 2012 Midyear Legislative Meetings and Trade Expo, housing will
play a large part in deciding the outcome of the 2012 presidential
election.
NAR President Moe Veissi, broker-owner of Veissi & Associates
Inc., in Miami. "We believe efforts that help creditworthy homebuyers
obtain mortgage financing and allow more people to stay in their homes
or avoid foreclosure through streamlined short sales are important for a
housing and economic recovery."
For the majority of Americans, their home is their largest asset
and the foundation of their familial stability. Taking steps to ensure
homeowners keep their homes helps those not only those owners but also
home values across the nation.
Federal Reserve Governor Elizabeth Duke also commented on the
need for a healthy real estate recovery. She noted that the health of
housing is the strength of the overall recovery. When would-be buyers
are worried about job security they aren’t thinking of buying. When
potential buyers can’t access credit they can’t buy homes.
"Unfortunately, some buyers who would like to purchase a home are
unable to do so because they cannot obtain a mortgage," said Duke. She
said the tightening of credit standards is apparent in the credit scores
of borrowers, noting that the median credit score
of borrowers rose
from 700 in 2006 to 760 in 2009, where it remains today.
Duke added that tight credit standards have made obtaining a
mortgage particularly difficult for first-time home buyers, since they
tend to be younger than other homebuyers, and have lower credit scores
and fewer financial assets.
"Just as uncertainty about job prospects or house prices has
likely discouraged some potential buyers from purchasing homes, it is
likely that uncertainty has also affected mortgage lenders," said Duke.
"Uncertainty surrounds several key aspects of mortgage lending,
including the strength of the economic recovery and the trajectory of
future house prices; the costs and liabilities associated with
originating and servicing mortgage loans; and the future structure of
the mortgage market."
For now housing affordability remains at an all-time high. The
NAR’s composite quarterly Housing Affordability Index (HMI) rose to a
record high of 205.9 in first quarter of this year. The greater this
number the more households that can afford to buy.
Veissi reports, "For those with good credit, we've never seen
better housing affordability conditions or market opportunities than we
see at present," he said. "Although home prices are stabilizing and
sales are rising, some buyers still have to jump through a lot of hoops
to convince a lender that they are creditworthy, even for a mortgage
that would be well within their means. This is especially true for
self-employed buyers."
Currently the index shows the median family income of $61,000 can
afford a home costing $325,500, which is double the national median
existing single-family home price of $158,100.
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