Half of Families Can Afford Most Homes on the Market: Report

According to data from ""Movoto.com"":http://www.movoto.com, a real estate site based in California, more than half of American families can afford to buy a new home based on income levels and listing prices.

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While the site's user search statistics show high interest in affordable price ranges, the company says buyers find it difficult to purchase short sales and foreclosures and banks are still reluctant to lend.

With 2010's median family income at $64,400, at least 50 percent of families could afford to buy a home priced at $150,000 or higher, according to Movoto.com.

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A person with an annual salary of $64,400 could reasonably afford a $215,000 home with a 5 percent down payment, an interest rate of 5 percent on a 30 year mortgage, and property taxes at 1.25 percent, assuming a monthly mortgage payment to monthly income ratio rate of 25 percent, the company explained in a statement.

However, these numbers do not add up to more home sales.

""According to the numbers, buyer interest, affordability, and home price inventory have aligned,"" said Henry Shao, CEO of Movoto. ""Median income levels can support mortgages at the most readily available housing prices, but we have yet to see a corresponding jump in sales.""

Shao continued, ""While overzealous lending practices have been blamed for the real estate fallout, it seems that now that people can afford what is available, the lending market is not meeting homebuyers' needs for loans to purchase reasonably priced homes, and banks are still making it difficult to purchase distressed properties.""

Movoto.com reports 55 percent of homes for sale on Movoto.com are priced under $250,000 and 24 percent are priced between $150,000 and $250,000 as of late December 2010. Movoto also reveals that 53 percent of home searches in December were for listings in the below-$250,000 price range.