San Francisco, which has been the nation’s least affordable major housing market for the past two years, was supplanted by Los Angeles in the fourth quarter of 2019, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Opportunity Index (HOI).
In all, 63.2 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 $75,500. This is virtually unchanged from the 63.6 percent of homes sold that were affordable to median-income earners in the third quarter.
Mortgage rates and home prices remained relatively stable over the past two quarters, which is why affordability held steady. The national median home price was $279,000 in the fourth quarter, essentially unchanged from $280,000 in the third quarter of 2019. Likewise, average 30-year mortgage rates stood at 3.78 percent in the fourth quarter compared to 3.73 percent in the third quarter.
Indianapolis-Carmel-Anderson, Ind. was rated the nation’s most affordable major housing market, defined as a metro with a population of at least 500,000. There, 91.5 percent of all new and existing homes sold in the fourth quarter were affordable to families earning the area’s median income of $79,900.
Meanwhile, Cumberland-Md.-W.Va. was rated the nation’s most affordable smaller market, with 96.7 percent of homes sold in the fourth quarter being affordable to families earning the median income of $59,300.
Los-Angeles-Long-Beach-Glendale, Calif., assumed the mantle as the nation’s least affordable major housing market. There, just 11.3 percent of the homes sold during the fourth quarter were affordable to families earning the area’s median income of $73,100.
All five least affordable small housing markets were also in the Golden State. At the very bottom of the affordability chart was Salinas, where 11.8 percent of all new and existing homes sold were affordable to families earning the area’s median income of $74,100.
Visit nahb.org/hoi for tables, historic data and details.