Rising mortgage interest rates and home prices cut into the purchasing power of homebuyers and made homeownership costs more burdensome in March, the National Association of Realtors said.

The NAR's Housing Affordability Index, which tracks monthly changes in homebuying capability, measured 103.8 in March, down from 106.4 in February.The March drop was the fourth straight fall in the Index, which last year averaged 113.2, down from 113.8 in 1987.

At 103.8, the index means that a family earning the national median annual income of $32,421 in March had 103.8 percent of the income needed to qualify for a conventional loan covering 80 percent of a home priced at $93,100, the national median price for existing single-family homes that month.

Half of the families in the United States earn more than the median income and half earn less. Similarly, half of the existing single-family homes sell for more than the median price and half sell for less.

The March qualifying income for the median-priced home was $31,246. Since the median income for the month, $32,421, exceeded the qualifying income, a family earning the March median income could qualify for a conventional loan to purchase a home priced at about $96,500.

A combination of higher median home prices, mortgage interest rates and median family incomes resulted in a $19 increase, from $632 to $651, in the monthly mortgage payment from February to March, the NAR noted. The monthly payment took 24.1 percent of the income, up from 23.5 percent in February. One year ago, the monthly payment was $579, taking 22.3 percent of the income.

NAR President Ira Gribin said Monday that the March drop in the Affordability Index was a symptom of a comparatively larger loss in housing affordability for entry-level buyers.

"In broad terms, homebuying conditions have remained relatively favorable, considering the jumps in interest rates," Gribin said. "However, each time the index shows an overall loss in purchasing power, the buyers on the lower rungs of the housing ladder get hit the hardest."

The drop in housing affordability in March was due to an increase, from 9.78 percent to 9.96 percent, in the mortgage rate used to calculate the index, as well as a $1,200 increase in the median home price, which rose from $91,900 to $93,100, the NAR said. The loss in buying power was offset somewhat by a rise in the median family income, which grew $107 from $32,314 to $32,421.

NAR chief economist John A. Tuccillo noted that the rise in the median home price in March reflects a market in which the bulk of purchases have been made by upper-income buyers least affected by mortgage rate increases.

Tuccillo said housing affordability should improve in the coming months, due first to price stabilization, followed later by a decline in mortgage rates.