After a reprieve in the first quarter of 2023, buyers’ outlook for housing affordability turned bleaker again in the second quarter. According to the latest Housing Trends Report, 76% of buyers are able to afford less than half the homes for-sale in their markets, up from 73% in the first quarter of 2023. On the flip side, the share able to afford most homes available fell from 27% to 24%. The shift provides evidence that recent upticks in home prices and mortgage rates are filtering directly into home buyers’ affordability expectations.
Affordability expectations between the first and second quarters of 2023 worsened in three regions. In the Midwest, the share of buyers able to afford less than half the homes available grew from 73% to 81%; in the South from 76% to 79%; and in the West from 66% to 72%. The only exception was the Northeast, where the share declined from 75% to 69%, i.e., fewer buyers were able to afford only a minority of the inventory available.
* Results come from the Housing Trends Report (HTR) – a research product created by the NAHB Economics team with the goal of measuring prospective home buyers’ perceptions about the availability and affordability of homes for-sale in their markets. The HTR is produced quarterly to track changes in buyers’ perceptions over time. All data are derived from national polls of representative samples of American adults conducted for NAHB by Morning Consult. Results are seasonally adjusted. A description of the poll’s methodology and sample characteristics can be found here. This is the fourth in a series of six posts highlighting results for the 2nd quarter of 2023. See previous post on plans to buy and new vs. existing preferences, and housing availability.