Over the past few years, the combination of low home prices and falling mortgage rates led to historic levels of housing affordability. Buyers were able to afford more for their money, which along with an improving economy, led to a rebound in the housing market. This year saw increases in prices, rates, and sales, all of which indicated that housing was in the midst of a sustained and continuing recovery. But that market recovery also impacted affordability levels. Affordability has been slowly declining as mortgage rates and home values increased. But, according to Svenja Gudell, director of economic research at Zillow, housing affordability is still much higher than historical levels as compared to an average from 1985 to 2000. Gudell says recent fluctuations in the housing market are normal adjustments and part of the process of home prices returning to more sustainable levels. More here.