The national median mortgage payment applied for by purchase applicants in February was $2,205 – basically flat compared with January – according to the the Mortgage Bankers Association (MBA).
Year-over-year, the national median payment was up by $21, equal to a 1.0% increase.
As a result, the MBA’s Purchase Applications Payment Index (PAPI), which measures home affordability, increased a mere 0.1% to reach a s core of 166.2 in February – up from 166.1 in January.
“Homebuyer affordability conditions remained unchanged in February as many homebuyers continue to weigh their options on entering the housing market amid economic uncertainty and slowly declining mortgage rates,” says Edward Seiler, associate vice president, housing economics, and executive director, Research Institute for Housing America, in a statement. “While February’s data reflects little movement, we do expect that rising housing inventory, coupled with lower mortgage rates, will spur additional activity in the housing market.”
An increase in MBA’s PAPI is indicative of declining borrower affordability conditions and means that the mortgage payment to income ratio (PIR) is higher due to increasing application loan amounts, rising mortgage rates, or a decrease in earnings. A decrease is indicative of improving borrower affordability conditions and occurs when loan application amounts decrease, mortgage rates decrease, or earnings increase.
Photo: Alexander Grey