Housing Affordability Remains Flat in 2017

Data for all four quarters of 2017 show housing affordability remaining essentially flat throughout the year, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Opportunity Index (HOI).

In all, 59.6 percent of new and existing homes sold between the beginning of October and end of December were affordable to families earning the U.S. median income of $68,000. This is just slightly up from the 58.3 percent of homes sold that were affordable to median-income earners in the third quarter, and effectively the same rate as in the fourth quarter of 2016, when the HOI stood at 59.9 percent.

 

The national median home price fell to $255,000 in the fourth quarter of 2017 from $260,000 in the previous quarter. Price changes in this series can sometimes diverge from other national measures due to the limited geographic scope of the underlying data. Meanwhile, average mortgage rates inched down four basis points in the fourth quarter to 4.06 from 4.1 in the third quarter.

Youngstown-Warren-Boardman, Ohio-Pa. and Syracuse, NY tied as the nation’s most affordable major housing market. In both metros, 88.3 percent of all new and existing homes sold in the fourth quarter were affordable to families earning the area’s median income of $54,600 and $68,000, respectively. Meanwhile, Cumberland, Md.-W.Va. was rated the nation’s most affordable smaller market, with 96.9 percent of homes sold in the fourth quarter being affordable to families earning the median income of $53,900.

San Francisco, which had been the nation’s least affordable housing market for 19 straight quarters before being displaced by Los Angeles in the third quarter of 2017, once again assumed the mantle as the least affordable market. There, just 6.3 percent of the homes sold in the last quarter of 2017 were affordable to families earning the area’s median income of $113,100.

All five least affordable small housing markets were also in the Golden State. At the very bottom of the affordability chart was Salinas, where 12 percent of all new and existing homes sold were affordable to families earning the area’s median income of $63,100.

Visit nahb.org/hoi  for tables, historic data and details.

 



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