Local home sales increased by 22% February over January. Nationwide, seasonally-adjusted home sales climbed 5% last month over January. The increase in home sales is partially attributed to a recently-enacted tax credit program. It is a favorable time for all buyers.

“It’s a Buyer’s market.” You’ve probably heard that phrase before when it comes to home buying. It means that conditions favor buyers at the moment. It relates to three primary reasons:

Ø                   Inventory of homes for sale is strong

Ø                   Mortgage rates are low

Ø                   Home prices are favorable

Considering today’s market place: (1) there is an ample supply of homes for sale, (2) mortgage rates are near 5%, and (3) the median-priced home for sale in the Cincinnati, 4-county, area is $123,000 What more could a buyer want?

Whether you’re a first-time homebuyer or repeat buyer, home affordability shines equally well in the Cincinnati area. You can’t say that for some parts of the nation, where housing and living costs are higher.

So how, exactly, is the Cincinnati-area housing market for affordability? Look at these “local-to-USA” comparative facts for the purchase of a single-family home:

                         MedianPriced       Monthly       Median     IndexAffordability

Location &             Single-              House         Family                    

Time Period        Family Home       Payment*     Income                 

                               (a)                     (b)               (c)

Nationwide

Jan 2009          $169,900           $747        $59,821          166.8                

Cincinnati Area

Q4 2008            $123,000         $564         $66,200          244.4**              

                                               *Principal+int.                      **higher is better

The above numbers show more home buying power in the Cincinnati area market vs. the USA as a whole due to: (1) more attractive home prices, (2) lower monthly payment (because of lower housing cost), (3) higher median income, and (4) greater affordability. The “affordability” index takes into consideration all “a-b-c” factors shown above. An Affordability Index of 100 means a person with a median income has exactly enough income for an 80% mortgage on a median-priced home (assuming a favorable credit score). Note: Other mortgage loans are available with lower down payments. In the end, you need to be comfortable with your monthly housing costs.

Please do not hesitate to call or email me with any real estate related questions or concerns.