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Learning about the Housing Affordability Index (HAI)
In 2021 a median-priced home of $450,000, at an interest rate of 3.25 percent on a 30-year conventional mortgage and a down payment of 5 percent, requires an income to qualify of about $123,590. Overlaying this data point with the Census Median Family income projection of $70,900 for 2021, the buyer(s) of this scenario would be short approximately $52,690 in annual gross income. This roughly translates into a Housing Affordability Index (HAI, referenced in slide 9 of this section) of 57.
Even with a 20% down payment, the income needed for the same purchase was $102,276, leaving the buyer(s) short approximately $31,376 in annual gross income (HAI of 69).