• Mortgage payments slip with lower prices.

• Interest rates ease.

• Family income improves.

The National Association of Realtors' Fixed Rate Mortgage Housing Affordability Index rose 2.7% during July (-11.9% y/y) to 150.4 following four declines in the prior five months. Affordability has fallen, nevertheless, 19.9% since its January high. A Housing Affordability Index of 100 indicates that a family earning the median income qualifies for an 80% mortgage on a median-priced existing single-family home. This index has been above 100 in each month since July 1990, reaching its all-time high of 213.3 in January 2013.

Affordability improved  during July as the median sales price of a home eased 0.8% (+18.6% y/y) to $367,000. The effective mortgage rate also fell to 2.92% from 3.03%. It reached a high of 4.99% late in 2018. That lowered principal & interest payments to $1,225 per month (+16.1% y/y) and 16.6% of income.

Family income edged 0.4% higher (2.3% y/y) to $88,457 but it remained 2.9% below the January high.

Data on Housing Affordability can be found in Haver's REALTOR database. Median home sale prices also are located in USECON. Higher frequency interest rate data can be found in SURVEYW, WEEKLY, and DAILY.