The National Association of Realtors reported that its Fixed Rate Mortgage Housing Affordability Index improved 1.3% to 151.9 during June (10.3% y/y) after falling 1.6% in May. Despite the increase, affordability remained 28.8% below the peak level during January 2013.

The affordability increase occurred in June as principal & interest payments eased m/m to 16.5% of median income from 16.7% in May. The percentage remained below its 18.2% peak in June 2018, but above the low of 11.6% in January 2013. Payments were pulled lower as the average mortgage interest rate declined to 3.84% in June from 4.11% in May and was sharply below December's high of 4.99%. Monthly principal & interest payments fell slightly to $1,082 per month. The median sales price of an existing home rose 4.5% y/y to $288,900. Growth in median family income picked up to 3.5% y/y in June from 3.4% during all of last year.

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.