After a slight improvement in the first quarter of 2023, buyers’ outlook for housing affordability dipped once again in the second quarter due to ongoing affordability concerns in the for-sale market. The latest Housing Trends Report from NAHB revealed that 76% of buyers in Q2 2023 could afford less than half the homes for-sale in their markets, up from 73% in the first quarter, but the share able to afford most homes available fell from 27% to 24%.
Elevated home prices and rising mortgage rates are creating lingering challenges for buyers and deteriorating affordability expectations in nearly every U.S. region. The share of buyers able to afford less than half the homes available grew from 73% to 81% in the Midwest, 76% to 79% in the South, and 66% to 72% in the West, NAHB Eye on Housing reports.
The shift provides evidence that recent upticks in home prices and mortgage rates are filtering directly into home buyers’ affordability expectations.
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.
Advertisement
Related Stories
Affordability
How Much Income Do First-Time Buyers Need to Afford the Average Home?
The median-priced home is unaffordable in 44 of the 50 largest U.S. metro areas
Affordability
What Is the Relationship Between Urban vs. Suburban Development and Affordability?
A new paper from Harvard's Joint Center looks at whether expanding the supply of suburban housing could, in turn, help make dense urban areas more affordable
Off-Site Construction
New Study Examines Barriers and Solutions in Manufactured Housing
The study from Harvard's Joint Center looks at the challenges faced by developers using manufactured housing and how they're overcoming those barriers