Housing-affordability conditions for all buyers reached a milestone in this year's first quarter, statistics from the National Association of Realtors show.

NAR's composite quarterly Housing Affordability Index rose to a record high of 205.9, based on the relationship between median home price, median family income, and average mortgage interest rate. The higher the index, the greater the household purchasing power. This is the first time the quarterly index broke the 200 mark since recordkeeping began in 1970.

NAR President Moe Veissi, broker-owner of Veissi & Associates Inc., in Miami, says market conditions are optimal for home buyers.

"For those with good credit, we've never seen better housing affordability conditions or market opportunities than we see at present," he says. "Although home prices are stabilizing and sales are rising, some buyers still have to jump through a lot of hoops to convince a lender that they are creditworthy, even for a mortgage that would be well within their means. This is especially true for self-employed buyers."

Veissi says home sales would be much higher if lending standards would return to normal.

The index shows the median income family, earning just under $61,000, could afford a home costing $325,500 in the first quarter, which is more than double the national median existing single-family home price of $158,100. The median monthly mortgage principal and interest payment for a median-priced home would take only 13.5 percent of gross income.

A companion index measuring the ability of first-time buyers to purchase a home also set a record, with the first-time buyer index reaching 135.8 in the first quarter.

Assumptions for the first-time buyer index include a lower income, at 65 percent of median family income, a starter home costing 85 percent of the median price, and a down payment of 10 percent. This index means the typical entry-level buyer could afford a home costing $182,500, which is well above the overall median price.

"It's never been easy to buy a first home because of the cash required for down payment and closing costs, but conditions for first-time buyers who are able to get a mortgage have never been better," Veissi says.

Both home prices and mortgage interest rates are expected to edge up modestly as the year progresses, but housing affordability will remain favorable, with the median-income household well positioned to afford a median-priced home, the association says. For all of 2012, the index is projected to set an annual record, averaging 191 for the year.

A composite index of 100 is defined as the point where a median-income family household has enough income to qualify for the purchase of a median-priced existing home, assuming a 20 percent down payment and 25 percent of gross income for mortgage principal and interest payments.