theMReport.com Your trusted source for mortgage banking news
With home prices on the rise, its unsurprising that home affordability is lower in the second quarter of 2017, although not by much. According to the National Association of Home Builders /Wells Fargo Housing Opportunity Index, 59.4 percent of all homes sale—new and existing—were affordable to families with a median household income of $68,000. In the first quarter, 60.3 percent of all homes sold were affordable to median-income households.
Median home prices on a national scare rose from $245,000 in the first quarter to $256,000, and increase of $11,000. This is in lieu of mortgage rates dropping 25 basis point, from 4.33 percent in the first quarter to 4.08 percent in the second quarter.
Regionally, the area of Youngstown-Warren-Boardman, Ohio-Pennsylvania, had a 93.3 percent rate of new and existing homes sales fall within the affordable housing market for families with a median income of $54,000. Second quarter 2017 marks the third consecutive quarter this region has commanded this spot.
Additionally, in smaller national markets, Kokomo, Indiana was given the title of the nation’s most affordable area for the second straight quarter—96.9 percent of homes sold were affordable to families with an even higher median income at $62,500.
In contrast, the nation’s least affordable market was the area designated San Francisco-Redwood City-South San Francisco, California, with 7.6 percent of homes being affordable to families with a median income of $113,100 per year. This metro has been the least affordable area to live in the nation for 19 straight quarters. In fact, the top five least affordable small-housing markets in the country all call California home, with Salinas, California sitting at the bottom of affordability at 12.4 percent and a median household income of $63,100.
Compared to the second quarter of 2016 when housing affordability was 62.0 percent, housing affordability is down in the second quarter of 2017. Median household is up, however, from second quarter 2016, when it sat at $240,000.
