Homebuyer affordability fell in April, according to Bureau of Statistics Mortgage Bankers Association(MBA) Purchase Requisition Payment Index (PAPI) is released on Thursday.
The index measures how new monthly mortgage payments have changed over time relative to income, based on data from the MBA Weekly Application Survey.
The national median payment for mortgage applicants in April was $2,256, up from $2,201 in March. April’s figure represented an annual increase of $144, equivalent to a 6.8% increase. Compared with a year ago, median income increased by 4.6%.
National median mortgage payment federal housing administration (FHA) loan applicants will see payments of $1,955 in April, up from $1,898 in March and up from $1,750 in April 2023. of $2,222, up from $2,170 in April 2023.
“With mortgage rates remaining above 7% in April, affordability for homebuyers has declined further, deterring many potential buyers from getting into real estate,” Edward Seiler, MBA’s vice president of housing economics, said in a statement. market. “In addition to lower mortgage rates, markets across the country are desperate for more housing inventory this summer to alleviate these dire affordability conditions. “
The increase in MBA PAPI indicates declining affordability for borrowers. This means that the ratio of mortgage payments to income is higher due to an increase in the loan amount, a rise in mortgage rates, or a decrease in income. PAPI decreases when loan application amounts decrease, mortgage rates decrease, or income increases.
The five states with the highest PAPI readings in April were Idaho, Nevada, Arizona, Florida and Rhode Island. Alaska, Louisiana, Connecticut, New York and Washington, D.C. had the lowest PAPI readings
