With Affordability Up, Home Buyers Are Starting to Return to the Market

WASHINGTON--(Business Wire)--
Thanks to record low mortgage rates and declining home prices, 55 million
families - or half of all U.S. households - can afford today's $200,000
median-priced new home, according to figures released by the National
Association of Home Builders (NAHB).

"That's an increase of 17 million households from conditions just two years ago
and the best housing affordability number we have seen in years," said NAHB
Chairman Joe Robson, a home builder from Tulsa, Okla. "We are now seeing the
first signs that buyers are returning to the marketplace."

Based on data from the U.S. Census Bureau comparing home prices, mortgage rates
and minimum income needed to purchase a median-priced home in February 2007 and
February 2009, a typical family today can purchase a house with $20,000 less in
household income and save nearly $500 per month on their principal, interest,
taxes and insurance. The number of households that can afford to purchase a home
today is 55.4 million, compared with 38.4 million two years ago, according to
figures compiled by NAHB.

Single-family permits were up 11 percent in February, new and existing home
sales also posted gains and the huge inventory backlog is being slowly whittled
down. In a survey for Century 21 Real Estate last month among prospective
first-time home buyers who indicated they were likely to purchase a home in the
next two years, a majority - 78 percent - said that now is a good time to buy a
home. Of those responding to the online poll, 68 percent said that now is a
better time to buy than six months ago.

Another sign that consumers are considering jumping back into the housing market
is the growing interest in the $8,000 first-time home buyer tax credit included
in the recently enacted economic stimulus package. During February and March,
1.5 million visitors logged on to NAHB's consumer Web site,
www.federalhousingtaxcredit.com, to learn more about the tax credit. Further, a
new survey commissioned by Move, Inc. found that nearly 20 percent of those who
plan to purchase a home this year are doing so to take advantage of the tax
credit, which expires at the end of November.

"With home values in many markets at the lowest level since 2003, an $8,000 tax
credit available to first-time home buyers, fixed-rate mortgages under 5
percent, and an outstanding selection of homes to choose from, buyers are
starting to recognize that this has the makings for a one-time opportunity to
break into the market," said Robson.

Construction of an additional 500,000 single-family homes - the difference
between today's anemic construction rate and one that would move closer to
meeting the underlying demand for housing - would generate 734,000 jobs and $35
billion in wages in the construction industry and another 790,000 jobs and $37.7
billion wages in manufacturing, trade, and service sector jobs, he noted.

For more details on how lower prices and interest rates during the past two
years have spurred a significant uptick in affordability, you can go to
http://www.nahb.org/generic.aspx?genericContentID=40372.

ABOUT NAHB: The National Association of Home Builders is a Washington,
D.C.-based trade association representing more than 200,000 members involved in
home building, remodeling, multifamily construction, property management,
subcontracting, design, housing finance, building product manufacturing and
other aspects of residential and light commercial construction. Known as "the
voice of the housing industry," NAHB is affiliated with more than 800 state and
local home builders associations around the country. NAHB's builder members will
construct about 80 percent of the new housing units projected for 2009.

National Association of Home Builders (NAHB)
Donna Reichle, 202-266-8473
dreichle@nahb.com
www.nahb.org

Copyright Business Wire 2009