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Area's homes among most affordable

December 14, 1998|By KERRY LYNN FRALEY

More than four-fifths of the homes sold locally in July, August and September were in reach of middle-income families, keeping the area among the most affordable for home buyers in the nation, according to third quarter figures released Thursday by the National Association of Home Builders.

The Hagerstown area ranked 25th nationally out of 187 metropolitan areas in the Washington, D.C.-based professional association's Housing Opportunity Index, the same ranking it held in the previous quarter, according to association figures.

However, it slipped from seventh to 10th most affordable area in the southern region, which includes Maryland, Virginia, Delaware, Louisiana, Florida, Tennessee, Texas, Alabama, North Carolina, South Carolina, Georgia, Kentucky, Mississippi and Oklahoma.

The index measures the affordability of homes in a market by looking at the percentage of homes sold that a family earning the median income in that market can afford to buy, according to a press release announcing the rankings.

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In the third quarter, families in the Hagerstown area earning its median annual income of $43,800 could afford 80.9 percent of new and existing homes sold in the area, according to the index.

The median home sales price in the Hagerstown area was $110,000 - $28,000 below the national median sales price.

Nationally, families earning the median U.S. household income of $45,300 could afford to buy 64.4 percent of the homes sold in the third quarter.

The affordability of homes in the Hagerstown area is an asset in convincing new companies to move into the area and existing companies to expand, said Thomas B. Riford, marketing specialist for the Hagerstown-Washington County Economic Development.

Cost of living is the top quality-of-life issue for companies both in consideration of the employees it will move to an area and to retain the workers it will hire, Riford said.

"If you tell me we're in the top 25 in the nation, that's fabulous news," he said.

The index, dating back to early 1991, is based on median family income, calculated by the Department of Housing and Urban Development, interest rates and the price distributions of homes sold for each market in a particular quarter.

The average interest rate used for the index calculations - representing a weighted average of adjustable- and fixed-rate loans - was 7.08 percent.

The five-county metropolitan statistical area encompassing Augusta, Ga., and Aiken, S.C., was the most affordable market nationally in the third quarter.

San Francisco remained at the bottom of the index rankings, where it has been since the index started.

Families earning the city's median income of $68,600 could afford to buy just 19.7 percent of the homes sold there in the third quarter.

The Midwest was the most consistently affordable region.

The West was the least affordable region.

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