This article first appeared in the PB June 2014
issue of Pro Builder.
Almost two-thirds (65.5 percent) of new and existing homes sold nationwide in the first quarter of the year were affordable to families earning the U.S. median income of $63,900, according to the National Association of Home Builders/Wells Fargo Housing Opportunity Index.
This is slightly higher than the 64.7 percent of homes sold that were affordable to median-income earners in the fourth quarter of 2013 and reflects somewhat lower median home prices along with steady mortgage interest rates. The index is a measure of the percentage of homes sold in a given area that are affordable to families earning the area’s median income during a specific quarter. The national median home price dipped from $205,000 in the fourth quarter of 2013 to $195,000 in the first quarter of 2014. Average mortgage interest rates were virtually unchanged, moving from 4.54 percent to 4.57 percent in the same period.
Syracuse, N.Y., was the nation’s most affordable major market; 93.7 percent of all new and existing homes sold there in the first quarter were affordable to families earning the area’s median income of $67,700.
Other major U.S. housing markets at the top of the affordability chart in the first quarter included Buffalo-Niagara Falls, N.Y.; Youngstown-Warren-Boardman, Ohio-Pa.; Harrisburg-Carlisle, Pa.; and Dayton, Ohio, in descending order.
Cumberland, Md-W.Va., was the leader among smaller markets with 96.3 percent of homes sold there in the first quarter affordable to households earning the median income of $54,100.
Smaller markets joining Cumberland at the top of the affordability chart included Springfield, Ohio; Kokomo, Ind.; Mansfield, Ohio; and Lima, Ohio.
For a sixth consecutive quarter, San Francisco-San Mateo-Redwood City, Calif., held the lowest spot among major markets. There, just 13.3 percent of homes sold in the first quarter were affordable to families earning the area’s median income of $100,400.
Other major metros at the bottom of the affordability chart included Santa Ana-Anaheim-Irvine, Calif.; Los Angeles-Long Beach-Glendale, Calif.; New York-White Plains-Wayne, N.Y.-N.J.; and San Jose-Sunnyvale-Santa Clara, Calif.; in descending order.
The five least affordable small housing markets were all in California. At the very bottom of the affordability chart was Santa Cruz-Watsonville, where 21.1 percent of all new and existing homes sold were affordable to families earning the area’s median income of $77,900. Other small markets at the lowest end of the affordability scale included Napa, Salinas, San Luis Obispo-Paso Robles, and Santa Rosa-Petaluma, respectively. PB
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