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Current Housing Issues Impacting Oregon Workshop Panelists: Richard Bjelland – OHCS Mark Radabaugh - DLCD The FAB Housing Affordability Calculator © A Personal and Regional Housing Affordability Calculator Developed by Richard Bjelland OHCS State Housing Analyst

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Current Housing Issues Impacting Oregon

Workshop Panelists:

Richard Bjelland – OHCS

Mark Radabaugh - DLCD


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The FAB Housing Affordability Calculator©

A Personal and Regional Housing Affordability Calculator

Developed by Richard Bjelland

OHCS State Housing Analyst


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Housing Affordability Assumptions

  • Housing is affordable when no more than 30% of income is spent on housing costs

  • Housing costs include mortgage payments, property taxes, insurance, and utilities

  • Mortgage payments based on 80% 30 year mortgage - no mortgage insurance needed

  • Property taxes set at $15 per thousand

  • Insurance based on State Farm Ins. rates

  • Utility costs based on housing value


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Mortgage Rates and Affordability

  • Affordability is a function of mortgage rates

  • An affordability calculator should reflect different mortgage rate assumptions

  • Three different mortgage rates used

  • Historical rate of 8.1% based on past rates

  • Low rate is set at 6%

  • High rate is set at 12%

  • Demonstrates significant effect of interest rates on current housing affordability


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Lender Income Ratios & Affordability

  • Historically lenders have used an income ratio of ~30% to determine affordability

  • Today’s lenders may increase the ratio depending on an applicant’s credit score

  • A housing affordability calculator should have flexibility to reflect this situation

  • The FAB Calculator will handle historical and an individual’s approved higher ratio


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Multi-purpose Affordability Tool

  • Can be used to determine income needed to afford a particular house for sale

  • Can be used by households to determine the price of housing that can be afforded

  • Calculates the annual and monthly income needed and equivalent hourly earnings

  • Can be used to assess the relative affordability of housing within a region by using median household income and the median sale price of housing in the region


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An Assessment of Central Oregon Housing

Prepared by Richard Bjelland OHCS State Housing Analyst


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Accessing the Housing Tools

  • Information on the Housing Needs Model can be found at the following URL - http://www.ohcs.oregon.gov/OHCS/PPR_HousingNeedsModel.shtml

  • Information on the FAB calculator series including the FAB Housing Affordability Calculator will be available at this URL - http://www.ohcs.oregon.gov/OHCS/PPR_AssetBuilding.shtml


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