The U.S. Department of Housing and Urban Development will create a nationwide reference tool for homebuyers that lists all local housing and transportation costs: the Housing and Transportation Affordability Index.
The initiative will cost $3.2 million, and a private contractor will create the database.
“Affordability is much more than just paying the mortgage. It involves other costs like transportation, gas and utilities,” says HUD Secretary Shaun Donovan. “A national affordability index will (give homebuyers) better information about the true cost of a home by taking into account its proximity to jobs, schools and other services.”
Donovan says HUD is creating the index to help homebuyers understand the true cost of homeownership. Transportation costs, for example, are not included in most current affordability studies, even though transportation is usually a household’s second-most significant expense.