Is Housing Really More Affordable?
Housing affordability indexes have been published recently showing that even with higher interest rates homes are 10% more affordable than in 1994 when interest rates increased a lot. However any comparison of affordability before 2009 is dubious and unreliable because of the use of Easy Qualifier loans from 1984-2009. These loans allowed borrowers to use stated income so that if a borrower had enough current income to qualify but didn’t have that income consistently for the past two years then he couldn’t qualify for the loan under current “fully documented income” rules, but he could qualify under the old method. …
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