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Housing Affordability Takes a Hit During Q4

ATTOM Data Solutions reported that median-home prices during Q4 2019 were unaffordable for wage earners in 71% of U.S. counties analyzed in the report—down 73% from Q3 2019 and 75% year-over-year. 

The report determined affordability by calculating the amount of income needed to make monthly house payments. 

“Home prices rose across the country by 9% year-over-year in Q4 2019, and the typical home remained a financial stretch for average wage earners. However, homes were actually a bit more affordable because of declining mortgage rates combined with rising pay to overcome the continued price run-up,” said Todd Teta, Chief Product Officer with ATTOM Data Solutions. “As long as people are earning more money and shelling out less to pay off home loans, the market should remain strong with prices continuing to rise, at least in the near term. Those are big ifs, but for now this report offers some decent findings for both home seekers and home sellers.”

The largest counties were median-priced homes in Q4 2019 that were deemed not affordable for average wage earners were Los Angeles County, California; Maricopa County, Arizona; San Diego County, California; Orange County, California; and Miami-Dade County, Florida. 

Of the 29% of counties deemed affordable during Q4 2019 included Cook County, Illinois; Harris County, Texas; Wayne County, Michigan; Philadelphia County, Pennsylvania; and Cuyahoga County, Ohio. 

ATTOM states home-price appreciation outpaced weekly-wage growth in 76% of the counties analyzed, with the largest being Los Angeles County; Cook County; Harris County; Maricopa County; and San Diego County. 

Wage growth outpaced home-price appreciation in 24% of the counties studied. These counties were Orange County; Miami-Dade County; Kings County, New York; and Santa Clara County, California.

Sixty-four percent of the counties studied required at least 30% of their weekly wages to buy a home during the quarter, while 36% of counties required fewer than30% of weekly wages.  

Also, of the 486 counties studied, 47% were less affordable than their historic averages during Q4 2019, which is down from 52% from Q3 2019. 

About Author: Mike Albanese

A graduate of the University of Alabama, Mike Albanese has worked for news publications since 2011 in Texas and Colorado. He has built a portfolio of more than 1,000 articles, covering city government, police and crime, business, sports, and is experienced in crafting engaging features and enterprise pieces. He spent time as the sports editor for the "Pilot Point Post-Signal," and has covered the DFW Metroplex for several years. He has also assisted with sports coverage and editing duties with the "Dallas Morning News" and "Denton Record-Chronicle" over the past several years.
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