In the majority of US counties, the current median price of a home or condo is far too expensive for an average homeowner. CNBC reports that 63% of counties now have median prices less affordable than historical averages. This is a 54% increase from one year ago. The affordability for an average wage worker is determined by the income needed for monthly mortgage payments, property taxes, and insurance on an average-priced home with a 20% down payment. Nationally, home prices are growing over time faster than wages are.
A pandemic-induced run on housing began in earnest in May and has not let up. Home sales in August were running at the fastest pace since 2006, and prices were up over 11% annually, according to the National Association of Realtors.
“In a year when nothing is normal, owning a single-family home has become less affordable to average wage earners across the U.S., despite conditions that would seem to point the opposite way,” said Todd Teta, chief product officer with Attom Data Solutions.