U.S. Home Affordability Drops to 4-Year Low

The affordability of U.S. homes fell to a four-year low in 2004 as a surge in prices offset lower mortgage rates, the National Assn. of Realtors said.

The average household had 132.6% of the income needed to purchase a property at the median home price of $184,100, the association’s housing affordability index showed. In the previous year, a household had 138.4% of the income needed for a median-priced $170,000 home.

A reading of 100% means a household with the national median income makes exactly enough to pay for a median-priced home. A higher reading indicates more affordability.