Housing affordability has been a persistent issue in many real estate markets across the country since the housing crisis. With household income lagging and home prices continuing their upward climb, fewer buyers are able to afford a home in today's housing market.
More wage growth could be coming to help buyers with affordability issues, according to a new report. Incomes should rise steadily over the next few years due to demand for high-income workers and a shortage of workers overall. The report stated that many middle-class buyers can no longer afford a new home due to price to income ratios, payment to income ratios, new home prices, and anticipation of rising rates.
Fannie Mae and Freddie Mac only consider the FICO credit scoring model when making mortgage purchase decisions, but some believe that this singular method of scoring is locking potential buyers out of the housing market and cutting into lenders' businesses. A recent report from Trulia showed that the use of alternate credit scoring models would help buyers obtain a mortgage that normally would have missed out on..