Chart of the Month

Metro Atlanta Housing Affordability

The following graph tracks the Median Home price and the Housing Opprotunity Index quarterly from 2000 through 2007.  What this represents is the share of homes sold in that area that would have been affordable to a family earning the local median income based on standard mortgage underwriting criteria. 

In the 4th quarter of 2007, approximately 69% of homes sold were affordable to families earning the median income.  The major component taken into consideration are median income and housing costs. The following assumptions were made:

a.A family can afford to spend 28 percent of its gross income on housing.
b.30-year fixed rate mortgage
c.10% down payment
d.Estimated property taxes
e.Estimated property insurance

Data source: NAHB/Wells Fargo