The issue of housing affordability was one of the hot topics at the recent National Association of Realtors Midyear Legislative Meetings and Trade Expo held in Washington, D.C.

While the median price of an existing home in California increased during the month of April by 14.8 percent, the Housing Affordability Index for the latest data available in March showed a slight drop to 28 percent. Although these two numbers interpret different findings, they can tell a story about how the real estate market is shaping up as 2003 unfolds.

"It's shaping up to be another banner year for real estate," said California Association of Realtors President Toby Bradley. "While sales last month declined compared to a year ago, sales in April 2002 were at their highest level in the history of California's residential real estate market. Year-to-date sales have declined 5 percent, in line with our expectations, while the median price continues to post double-digit gains."

The median price of an existing single-family detached home in California during April 2003 was $363,930, a 14.8 percent increase over the revised $317,120 median for April 2002, the association reported. For comparison's sake, the median price of an existing single-family detached home in California during March 2003 was $352,780. The April 2003 median price increased 3.2 percent compared to a revised March 2003 $352,480 median price.

When looking at affordability numbers, the minimum household income needed to purchase a median-priced home in California is approximately $82,000, based on a typical 30-year fixed-rate mortgage at 5.80 percent and assuming a 20 percent down payment. The association's housing affordability index measures the percentage of households that can afford to purchase a median-priced home in California.

The issue of affordability in the nation was the focus of a Realtor-sponsored housing opportunities workshop that featured the National Association of Realtors video The New Face of Affordable Housing. The video highlights the critical issue of how affordable housing is perceived by the local community. Unfortunately, certain myths and half-truths about affordable housing often make it difficult for policymakers and the public to support subsidized housing. False impressions and misinformation often spawn NIMBYism (Not In My Back Yard).

The National Association of Realtors Housing Opportunity Program and several local Realtor associations are tackling these issues with some innovative programs that others might adopt. The video will be distributed to 1,700 state and local Realtor boards. Karen M. Miller, president-elect of the National Association of Counties and a county commissioner for Boone County, Mo., spoke at the workshop, remarking that "the biggest problem with affordable housing is perception. Realtors play a big part in helping educate people that affordable housing is not detrimental to neighborhood home values. It's the job of the whole community to solve the problem of affordable housing."

John Gifford, president of the Greater Nashville Association of Realtors, talked about the importance of forming partnerships within local communities. For example, his local association works closely with officials from the office of the mayor, the regional housing fund, the state development and housing agency, the local Habitat for Humanity affiliate, the local office of Fannie Mae and other community groups to create affordable housing opportunities. "Affordable housing is good for the individual, good for the community, good for local business and the economy, and good for Realtors," he said.

Kit Hale, chair of the Affordable Housing Image Workgroup of the Virginia Association of Realtors, said affordable housing is all about image and attitude. "We need to acknowledge the misunderstanding of affordable housing in the marketplace. If you can affect hearts, you will change minds," Hale noted.

Jim Hamilton, a Realtor from California who chairs the association's Housing Opportunity Program, concluded the panel by echoing the theme of this year's midyear legislative meeting—"Connecting Communities to Capitol Hill: We Build a Better America by Improving Housing Opportunities."

"We need to demystify affordable housing and what it takes to put it into business. It's about attitude, passion and commitment. If you want to reach people, you have to put a face on it and bring it home. It's about moral obligation and doing the right thing. As Realtors, we have an opportunity to make a difference," Hamilton proclaimed.

Locally, the Silicon Valley Association of Realtors has placed affordability issues on the table as well. The group participated with approximately 40 other associations in a recent summit to address housing affordability by exchanging information, ideas and answers with a goal of developing a plan to move forward.

The lack of land and space for affordable housing is often an issue in the Bay Area, so other approaches and innovative programs are sometimes the answer. The Silicon Valley Association of Realtors program to help seniors stay in their homes by providing repairs and other household tasks is one example of a creative approach to affordable housing.