Housing Affordability in Florida Better than National Level

Ten of 12 major  Florida  metropolitan markets surpassed the national affordability index for single-family homes in 2012, based on data from the National Association of Realtors (NAR).

Additionally, these 12 metro markets all surpassed 100, the level at which a median-income family has the exact income to buy a median-priced existing single-family home with a 20-percent down payment and with the monthly principal and interest payments accounting for 25% of the monthly income.

The farther up the index from 100, the stronger the purchasing power of median-income families in the area for pre-owned single-family homes.

NAR calculates the housing affordability index comparing the metro area’s median household income and the median home price, together with the effective mortgage interest rate.

The national single-family home affordability index in 2012 was 193.5, which was surpassed by ten major  Florida metro markets,  as shown in the following table:

Note though that the index for Ocala was for the fourth quarter of 2011. Its index for the fourth quarter of 2012 was missing.

The affordability index in the  Tampa Bay real estate market  is 36.1 points higher than the national index and more than double the 100 level. As of the fourth quarter of 2012, the median home price in the  Tampa  area was $137,200, lower by 23.3% than the national median home price of $178,833 in the same quarter. The conforming loan limit and FHA loan limit for the area are both $417,000.

In terms of year-over-year improvement in housing affordability, it was Gainesville that led the other 12 markets. Although Cape Coral-Fort Myers declined in affordability over the year, its affordability index was still among the highest.

The 12 metro areas with the highest housing affordability indices in 2012 were the following metro markets: