SACRAMENTO HOMES ARE A BARGAIN COMPARED TO HISTORIC NORMS

sacramento Homes are a Bargain Compared to Historic Norms

Last Chance! Homes are a Bargain Compared to Historic Norms | MyKCM

We ran across this great post – courtesy of the good folks at Keeping Current Matters and thought you might enjoy the read.

A loaf of bread used to be a nickel. A movie ticket was a dime.  Not anymore. Houses were also much less expensive than they are now. Inflation raised the price of all three of those items, along with the price of almost every other item we purchase.

The reason we can still afford to consume is that our wages have also risen over time. The better measure of whether an item is more expensive than it was before is what percentage of our income it takes to purchase that item today compared to earlier. Let’s look at purchasing a home.

The COST of a home is determined by three major components: price, mortgage interest rate, and wages. The big question? Are we paying a greater percentage of our income toward our monthly mortgage payment today than previous generations? Surprisingly, the answer is no.

Historically, Americans have paid just over 21% of their income toward their monthly mortgage payment.

Though home prices are higher than before, wages have risen as well. And, the most important component in the cost equation – the mortgage rate – is dramatically lower than it was in the 1970s, 1980s, 1990s, and 2000s.

Today, according to the latest Home Affordability Index just released by the National Association of Realtors, Americans are paying 17.4% of their income toward their mortgage payment. That is much lower than the 21% average previous generations have paid.

Last Chance! Homes are a Bargain Compared to Historic Norms | MyKCM

Bottom Line

The cost of purchasing a home today is a bargain compared to previous generations when we look at it from a percentage of income basis. However, with mortgage rates expected to increase and home prices continuing to appreciate, that will not always be the case. Whether you are buying your first home or looking to move-up to a more expensive home, purchasing sooner rather than later probably makes sense.

Looking to buy a Home in Sacramento? You’ve come to the right place. Search all homes in Sacramento and surrounding areas from the comfort of your own home. Call Mike and Jennifer Rigley at 916.660.5823

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Looking for a top Sacramento realtor? Call the Rigley Realty Group  today at 916-660-5823 or log on to www.RigleyRealtyGroup.com to start your on-line home search now. Call us today – you’ll be glad you did.

Mike and Jennifer Rigley are one of Sacramento’s top ranked Real Estate Teams and 5 Star Ranked Real Estate Professionals. Selling Real Estate Full time since 2004 with well over 1,500 successful closings Mike and Jennifer Rigley are here to help your dreams of Home Ownership come true.

Mike and Jennifer Rigley of the Rigley Realty Group come with over 15 + years experience helping buyers, sellers and investors realize their Real Estate dreams. Including:

  • 35+ Year Sacramento Residents
  • Over 1,500 homes sold since 2003 – 10x the average agent
  • Team Approach for Maximum Client Satisfaction
  • Ranked in the Top 25 of all agents & companies county wide in both the number of listings & sales since 2004
  • Top 500 Teams All Companies in California for Production
  • Sacramento Magazine 5 STAR Agent

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